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DEPARTMENTS OF VETERANS AFFAIRS AND HOUSING AND URBAN DEVELOPMENT, AND INDEPENDENT AGENCIES APPROPRIATIONS ACT, 2002 -- (Senate - August 02, 2001)

Ms. MIKULSKI. Mr. President, I thank both Senators because last night

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the Senator from Arizona, Mr. Kyl, said he would be here at 10:30 this morning, ready to offer his amendment and ready to debate it and line up his speakers. He really met that commitment. We thank him for honoring that commitment.

   Also, he made it very clear last night that the other Senator from Arizona wished to speak. We want to be able to accommodate him because I think we have been moving along in a spirit of comity. I would just ask the proponent of the amendment if we could encourage those speakers to come to the Chamber. My remarks will not be of a prolonged nature. If the two Commerce Committee Senators could come over, I believe we could have this amendment wrapped up before lunch and, I think, would be moving in a well-paced way.

   Again, we want to keep the kind of atmosphere of civility that has set the tone of the bill. If everyone would notice, there has not even been a quorum call. So I am ready to make my remarks. We would then go to those two other colleagues to speak.

   I ask the Senator, are they coming?

   Mr. President, we are going to have a little quorum call, just for clarification.

   I suggest the absence of a quorum.

   The PRESIDING OFFICER. The clerk will call the roll.

   The legislative clerk proceeded to call the roll.

   Ms. MIKULSKI. Mr. President, I ask unanimous consent the order for the quorum call be rescinded.

   The PRESIDING OFFICER. Without objection, it is so ordered.

   Ms. MIKULSKI. Mr. President, again, I thank the Senator from Arizona for proposing his amendment and moving with a promptness that is appreciated by both Senator Bond and I. I acknowledge the validity of many of the concerns that the Senator from Arizona raises.

   When you have a State such as Arizona, that certainly is growing in population, and you find out you are down on a list of Federal funds , it is, indeed, troubling.

   I also acknowledge the fact that the Nation is facing a clean water funding crisis. It is estimated that we have an annual funding shortfall for clean water infrastructure of at least $12 billion. I can honestly tell the Senator that if I gave $1 billion to every State in the Union over and above what is in our bill, it would be well used because it is needed.

   We have heard about water problems from failing septic tanks in the Delmarva region that you and I represent, where the rural poor really do not have the bucks to do it. We have heard about the big failing water systems in the Chicagos and the Baltimores, where they were built over 100 years ago, and it is beyond the scope of this Appropriations Committee to deal with it.

   We need full-scale authorizing hearings on the needs for America's water infrastructure --both the needs and the formula. So I acknowledge that this is a big deal and a big problem.

   There is not a community in this country--urban or rural--that does not have some important funding need related to water , whether it is from Baltimore to St. Louis to Stafford or Scottsdale, AZ. However, I must say, Senator Kyl's amendment is outside of the scope of the VA-HUD bill. I truly believe, because it is a formula change, that it will trigger essentially a water war on the VA-HUD bill.

   This is, indeed, an authorizing issue and should be addressed by the authorizers in comprehensive water infrastructure legislation.

   Last night we had an excellent discussion on the issue of arsenic. We all agreed that arsenic is a problem. We all agreed that complying with the Federal mandate on arsenic will also be a problem. So our colleague, the Senator from New Mexico, Mr. DOMENICI, offered an amendment for authorizing on funding. We thought that was an excellent way to go and, wow, suddenly you had a Domenici-Mikulski-Schumer-Clinton-Bond--an amazing list of cosponsors. The message of that was not only that arsenic is a problem, but, like last night when we talked about it, how do we pay for these water issues?

   What we have done--again, working on a bipartisan basis--the VA-HUD bill does not break new ground on environmental issues. We essentially broke no new ground, whether it was on enforcement, whether it was reallocating from sewers to State revolving funds , and so on.

   We essentially kept the framework from last year to get the President to put his arms around it, to get our new EPA Administrator to put her arms around it, to then look at what EPA should be and what are some of the new changes we need to make.

   We think we have gotten off to a good start. Because this is a year of transition, both within the executive branch and also within this subcommittee, that was the framework we approached, so that we could be prudent, that we would not lurch ahead in either the executive or legislative branch and make mistakes that we would have to then go back and evaluate.

   As my colleagues know, often on environmental issues, we end up with either unfunded mandates or, in some instances, unintended consequences to what seems to be a good idea.

   The new chairman of the Committee on Environment and Public Works believes that water should be at the top of his agenda. He is here today to speak on that. EPA is currently working on a needs survey for clean water funding. This should be done early in the next calendar year.

   I cannot support the Kyl amendment until the authorizers have had an opportunity to examine the needs survey and we have the very important census data related to growth that the Senator from Arizona has talked about. We all acknowledge that Arizona has grown, but we want to have more data on that. Then we need to have recommendations on how to clearly allocate our clean water .

   There is also another issue with the actual formula that the Senator is proposing. It is going to be a little geeky here so stick with me.

   This amendment would require EPA to allocate the fiscal year 2002 clean water State revolving fund appropriation to the States using an allocation formula for the drinking water State revolving loan fund.

   Remember, we have two revolving loan funds : one for clean water and the other for drinking water . You might say: Why is that such a big deal? Dirty water is dirty water , and why not commingle the formulas?

   This is really inconsistent with the Nation's wastewater and clean water needs. Drinking water systems and wastewater systems are fundamentally different. They deal with two different problems. They focus on different pollutants. Wastewater systems concentrate on removing pollution that deteriorates our rivers, lakes, and our bays--the Chair is familiar with it--the nitrogens, the phosphorous. That is why we have those problems on the Chesapeake Bay.

   The drinking water system removes pollutants and treats water to make sure it is safe to drink. One, we are drinking it; and the other drops it into the big drink like the Chesapeake Bay --two different things and two different kinds of pollution.

   When we get our drinking water , we are not dealing with phosphorous and nitrogen and those issues with which we have had to deal.

   In addition, the wastewater systems need to address shortcomings from the past, such as combined sewer overflows. Anyone from the city knows that this combined sewer overflow and the sanitary overflows are really big issues. There is no parallel to those issues in the drinking water systems. You can see how they are different. Then to use the same formulas, it gets to be a problem.

   Also, this amendment has another fundamental flaw. It references a water infrastructure needs survey to be conducted

   under the Safe Drinking Water Act. EPA has advised the committee today that no such survey exists. The wastewater needs survey is required under the Clean Water Act, not the Safe Drinking Water Act.

   We are going to get lost here. We don't want to get lost on the Senator's needs or what we want to accomplish. This shows exactly why this is the wrong place to offer this amendment. It is so complicated. We have needs surveys. We have formulas. We have safe water . We have clean water . We have drinking water . We have dirty water . We have wastewater. We need to be clear that the formulas are based on the problem to be addressed as well as on population.

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   Section 2 of the Senator's amendment is unclear. The Agency would be at a loss on how to calculate the formula given this direction.

   The needs for surface water quality projects differ geographically from drinking water projects. For example, some communities are served by central drinking water systems, but there is no municipal wastewater system. In another circumstance, a community may have a minor drinking water problem but might have a terrible or significant combined sewer overflow or a sanitary sewer overflow. As a result, surveying the construction needs of drinking water systems has no connection to the wastewater treatment system in the same community.

   The Presiding Officer was a Governor. I am sure he follows that. But most of all, local government follows it.

   Which brings me to another issue: Changes of this magnitude applied here with such scant notice would severely disrupt State programs. States must plan ahead. They have to use an expected range of capitalization grants for planning purposes. You have to know what you are going to get and when you are going to get it. Changes of the size implicit in the amendment would stop the State CWSRF, the clean water State revolving fund, loan programs for a significant period of time. This means that States would have to scurry around, prepare new intended-use plans, hold public hearings, try to get their bond issues straightened out.

   As you know, States have capital budgets. We don't. Capital budgets are based on what is going to come out of general revenue and what able Governors take to the bond market. A lot of our water and sewer is done on bonds, particularly at the local level.

   This is going to wreak havoc in all States. I know the Senator's intention is to get more money into some States. It will wreck havoc even in his own State .

   Keep in mind, we will not only have the loss of money but we will have the loss of time. It will affect our drinking water as well as our commitment to the environment.

   The clean water State revolving fund addresses clean water needs which are very different from drinking water . I have talked about that. The use of the drinking water State revolving fund would misdirect resources, resulting in a mismatch between the allocation of Federal funds by States and by the State's needs.

   I could go on: Who are winners, and who are losers.

   The important thing is, when it comes to water , there should be no losers. We all have our needs. We all have our problems. These formulas were originally established to meet those needs.

   Maybe there is the need to adjust those formulas. In every formula, some States gain and some States do not do as well as they should. Formulas are really complicated. They do approach the level of treaty negotiations.

   To try to do this on this bill would wreck havoc. It would trigger Senators coming to see what they are going to get and what they are going to lose.

   The more prudent way would be for there to be some type of instruction to EPA for evaluation. We would be happy to enter into a colloquy with both Senators from Arizona. We would be happy to sign a letter to the very able Administrator at the EPA outlining the concerns the Senators have.

   But we don't think we should have this amendment. If we pass this amendment, it is going to wreak havoc in the States with their ability to administer their programs; it is going to wreak havoc with the capital programs; it is going to wreak havoc with their bonds; and, most of all, it is going to wreak havoc with, really, the confusion that is going to come with using one formula for wastewater and use it also for drinking water . We really encourage--because it is not sound--this is not the place to enter into such a significant, complex public policy debate with enormous consequences to our constituents, to our communities, to our States and their ability to meet their fiscal responsibility as well as their environmental and public health stewardship. I am telling you, this is really the very wrong place to do this amendment. I oppose it.

   The PRESIDING OFFICER. The Senator from Missouri is recognized.

   Mr. BOND. Mr. President, I thank my colleague, the chair of the subcommittee, the Senator from Maryland, for laying out the concerns, first, that the EPA has about it. I am relieved to see I was not the only one confused by the formula. I tried to figure out how the formula in section 2 would work, and I found a lot more questions than answers.

   The EPA has advised us that they don't know how the formula would work. That is why I said a few moments ago that on these complicated items there needs to be substantive hearings. There should be hearings on how the changes might affect existing water bonding issues, existing water programs in the States. There should be hearings on how these changes would affect the States where the needs are. Most important, we need to sit down with all of the players and make sure we have a formula that everybody understands and that works.

   So I believe the EPA has given us the reasons that we described in general about the problems in trying to adopt a significant change on the floor. Having said that, I am very enthusiastically a supporter of the suggestion the chair of the committee has made that we join either in a colloquy, letters and instruction, first, to the EPA, to present to us options for revising and updating the formula, if needed, for both the drinking water revolving fund and the clean water revolving fund and the one that deals with wastewater, to give us their best assessment and to actually provide that to the Environment and Public Works Committee so we will have something with which to work.

   As I have said before, I am a most enthusiastic proponent of revising these formulas and finding ways to put more money into this very badly needed area, for investments for the future health and well-being of our community.

   With that, I yield the floor.

   The PRESIDING OFFICER. The Senator from Virginia is recognized.

   Mr. ALLEN. Mr. President, let me say to my colleagues I very much support the Safe Drinking Water Act. There are tremendous needs throughout America and in our Commonwealth of Virginia, especially in the southwestern region of Virginia.

   This issue deals with wastewater and the need for cleaning up our wastewater, where there are combined sewer overflow situations in Lynchburg, Richmond, and other areas, as well as the Northern Virginia area, which flows into the Potomac, which affects the Chesapeake Bay, which is important to Virginia and the State of Maryland; and the Chair's home State of Delaware has a few tributaries that flow into the Chesapeake Bay. It is also important to Pennsylvania and New York, which are also part of that watershed.

   Now, again, I am very much in favor of all these ideas. The question is: How do you meet the needs? In trying to determine how you meet the needs for clean water , drinking water , and clean water as regards wastewater treatment, you want to have a good, objective, up-to-date determination of needs.

   The drinking water allocations are based on EPA's recommendations. There is a needs survey. But as I best understand it--and I may ask, in a moment, my colleague from Arizona, Senator Kyl, to join me to explain this because some fellow Senators are saying they don't understand this, and I want to have a better understanding.

   The wastewater moneys are based on a 1970s population number and have not changed since the law was passed in 1987, 14 years ago. As I understand this formula change, what it attempts is to bring in fairness and equity and address the needs for wastewater cleanup and base the numbers on EPA's wastewater needs survey. So it is a similar sort of logic and formula and survey that is used for drinking water that we would want to use for wastewater.

   It strikes me, regarding the matter of fairness, that a minority of States in this proposal get way more than the percentage EPA recommends under the current formula and a majority receive much less--mostly in States that are growing faster. Regardless, everyone recognizes--and I haven't heard anybody listening to the debate on the floor or in between saying that the current formula is right--now is the time

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to make sure the wastewater allocations, the taxpayer dollars, are being utilized in a way that addresses the needs of the various States.

   The formula change also does not affect the so-called earmarks. That is separate and in a smaller pot of money. I ask the Senator from Arizona, Mr. Kyl, if he will please take the floor and let me ask him a few questions so we can clear up any misunderstandings that have been proffered here by others who may not seem to understand this proposal.

   I ask the Senator from Arizona this: The current plan, the current allocation for wastewater moneys, is it a formula based on population from the 1970 census?

   Mr. KYL. Mr. President, I say to the Senator from Virginia, my staff has tried to find out the basis for the current formula, and they have had a very difficult time getting anybody to tell them what it is. We have gone back in the debates, in the records, and so on. As best we can tell, it is a formula that is based upon a construction grant program using 1970s data, including population data. That is as clear as I can be about it. I urge anybody--of course, I find it

   interesting that those who are opposing the amendment do so on procedural grounds, not defending the existing formula. I haven't found anybody to defend, let alone explain, what the basis of the existing formula is.

   Mr. ALLEN. If the Senator will yield for a further question, I ask the Senator from Arizona this: The formula he is proposing here, though, is based, as he states, on needs, actual needs. How do you determine those needs? What is the formula? What is the criterion by which needs are addressed?

   Mr. KYL. I appreciate that question from the Senator because there has been, I think, a misunderstanding here. My understanding is that EPA has at least two different ``needs surveys,'' as they call them. They survey needs of communities for drinking water , and we use that survey with a formula for the allocation of drinking water moneys in a different place in this bill. They also do a survey for wastewater needs.

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