EPA Proposes Water Infrastructure Program Changes in Upcoming Bill

Significant drinking water and wastewater infrastructure legislation is in the works and could be unveiled by January, key lawmakers in the Senate Environment and Public Works Committee said during a Wednesday hearing.

Sen. Jim Jeffords (I-Vt.), the full committee chairman, and Sen. Bob Graham (D-Fla.), chairman of the water subcommittee, elaborated on their intentions during a session aimed at revealing innovative water infrastructure funding approaches that states and local communities could use to stretch government money as far as possible. Asked what such legislation should include, the Environmental Protection Agency's top water official, along with a number of water interests, suggested some tinkering with the catch-all Clean Water State Revolving Loan Fund (SRF) and the Drinking Water State Revolving Loan Fund (DWSRF) as a means to more effectively utilize the billions of dollars state governments receive each year.

G. Tracy Mehan, assistant administrator for EPA's Office of Water, suggested lawmakers consider making permanent a state's ability to transfer funds between the SRF and the DWSRF. He also recommended pushing back the loan repayment deadline for the SRF from 20 years to 30 years, which is the same timeframe as the DWSRF. Mehan also said Congress could tackle expanded conservation practices and the consolidation or privitization of water systems where applicable.

Broaching other measures that could make water infrastructure spending more efficient, witnesses suggested targeted modifications to the existing tax code, specifically in waiving the cap on private activity bonds and changing the arbitrage rules. While tax matters are outside the committee's jurisdiction, Graham and Jeffords noted they are members of the applicable Finance Committee, which is headed by Sen. Max Baucus (D-Mont.), also an environment committee member. Peter Cook, executive director of the National Association of Water Companies, said the bond issue is a "simple change" that would make capital both easier to obtain and less expensive (and more economically attractive) for partnerships between the public and private sector.

Looking ahead, Graham said he would like to hold two more hearings on water and wastewater infrastructure issues if time allows this year, one on the nation's water supply and another on the SRF formula itself. Graham also said he would like to unveil a comprehensive infrastructure bill as early as January 2002. "This issue is a priority of this subcommittee," he said.

Sen. Kit Bond (R-Mo.), the ranking member on the appropriations subcommittee charged with EPA's budget, took Graham's intentions a step further in saying he hoped Congress would pass a water infrastructure bill before next October, which is the 30th anniversary of the Clean Water Act. Bond also said the White House and Congress should work to create larger authorizations level for the SRF and DWSRF, currently $1.35 billion and $850 million respectively. -- Darren Samuelsohn

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