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The Senate Environment and Public Works (EPW) Committee approved by voice vote on May 14 legislation reauthorizing the Clean Water State Revolving Fund (CWSRF) and Drinking Water State Revolving Fund (DWSRF). The Water Infrastructure Financing Act of 2009 (S. 1005) would reauthorize the CWSRF at $20 billion and the DWSRF at $15 billion for fiscal years 2010 through 2014 and provide $1.8 billion in grants to address combined and sanitary sewer overflows (CSOs and SSOs), $250 million for critical water infrastructure projects, as well as$25 million for technical assistance to small and rural communities. The House already passed its version of the bill in March, called the Water Quality Investment Act of 2009 (H.R. 1262), to reauthorize the CWSRF only at $13.8 billion over fiscal years 2010 through 2014. NACWA worked consistently on this legislation on its own and via the Water Infrastructure Network (WIN) to ensure the clean water community’s voice was heard in ensuring key improvements to the bill.

Water Infrastructure Financing Act Provisions Reflect NACWA Improvements

Effective Utility Management
NACWA successfully advocated for the inclusion of key utility management-related provisions in line with the joint effort for Effective Utility Management. Specifically, the legislation authorizes a new $5 million U.S. Environmental Protection Agency (EPA) program to provide training and technical assistance to utilities on effective utility management strategies. EPA, working cooperatively with stakeholder organizations, would provide seminars, workshops, conferences, published materials and other educational programs, while offering support and advice to utilities on effective utility management strategies. This will help house key water sector utility management efforts – an area which has garnered significantly heightened attention as a result of the agreement between EPA and key water sector organizations, including NACWA, regarding the 10 attributes of an effectively managed utility (see www.watereum.org). In carrying this out, EPA ‘s Administrator may enter into cooperative agreements with stakeholder associations, qualified non-profit organizations, and other relevant organizations. The legislation also lists the 10 attributes of an effectively managed utility directly, demonstrating the traction this join water sector effort has garnered.

Affordability
Advocacy efforts by NACWA and its affordability workgroup led to the initial introduction earlier this year of the bipartisan Clean Water Affordability Act (S. 854) calling on EPA to update its 1997 Combined Sewer Overflows – Guidance for Financial Capability Assessment and Schedule Development. This effort also resulted in the adoption of an affordability amendment written by Sen. George Voinovich (R-Ohio). The provision requires EPA to gather information and data for the purposes of revising the 1997 document. It does not, however, explicitly require EPA to update its guidance. Specifically, the amendment dictates that:

Not later than 180 days after the date of enactment of this Act, for the purpose of updating the document entitled "Combined Sewer Overflows-Guidance for Financial Capability Assessment and Schedule Development" and dated February 1997, the Administrator shall—

1. collect and take into consideration information that can be used to assess the financial condition of permittees under the Federal Water Pollution Control Act (33 XJ.S.C. 1251 et seq.) and the Safe Drinking Water Act (42 U.S.C. 300f et seq.);
2. conduct a public outreach process regarding that information; and
3. consult with the affected States, municipalities, and other interested parties, as determined by the Administrator, regarding that information.

Unfortunately, due to opposition from EPW Chairwoman Barbara Boxer (D-Calif.), Voinovich was not able to amend the SRF reauthorization bill to include S. 854 in its entirety, which would have required an update of the 1997 guidance document to include the more flexible and site-specific affordability criteria outlined in NACWA’s November 2007 NACWA Financial Capability Compilation.

Though the affordability language included does not accomplish everything that S.854 lays out, it does point to broad, bipartisan Senate support for updating and revising the 1997 CSO Financial Capability Guidance. NACWA will continue to make the case that this review and update of the guidance be conducted with the principles of S.854 at the forefront and will continue to develop support, especially in the House, for separate affordability legislation. NACWA will also be putting together at the appropriate time a letter to Administrator Jackson and the incoming AA for Water Peter Silva expressing the growing, bipartisan support for such a review and update. NACWA is also working with congressional staff on report language elaborating on the affordability provision in the SRF bill and expressing the need to look at the criteria contained in S.854.

Grants for Disadvantaged Communities and Green Infrastructure
The Senate bill also allows up to 30 percent of the CWSRF dollars to be used as additional subsidization in the form of grants for principal forgiveness for disadvantaged communities (defined more broadly to include “a portion of a service area,” i.e. pockets of poverty within larger urban centers) or to promote the use of green infrastructure. The CWSRF does not currently provide for additional subsidization in the form of principal forgiveness or grants and NACWA strongly supported the additional subsidization provision and believes that grants or loan forgiveness is needed as SRF funds grow larger.

Sewer Overflow Control Grants
The bill also authorizes $1.8 billion over fiscal years 2010 through 2014 for federal sewer overflow control grants under section 221 of the Clean Water Act. The provision authorizes EPA to provide grants directly to local governments during the first two years of the program, while allocating the funding to states based on their need to address overflows for the remaining three years. States would then distribute the money to local governments. Priority would be given to projects involving the use of nonstructural, low-impact development, water conservation, efficiency, reuse, or other decentralized stormwater or wastewater approaches to minimize flows into sewer systems. A similar authorization for federal grants addressing sewer overflows was included in the House bill, H.R. 1672. However, H.R. 1672 was amended during floor debate to increase the authorization to $2.5 billion over five years to control sewer overflows. NACWA will work to ensure that the version of the legislation which ultimately passes includes the House-passed number of $2.5 billion for overflow projects.

Buy American
The controversial “Buy American” provisions that were in the stimulus package were not included in the Senate bill. While NACWA has not taken a position on Buy American, NACWA has expressed concerns with the expansion of such provisions into additional bills like S. 1005 because they could delay and increase cost and potential liability concerns for wastewater infrastructure projects eligible for SRF funding.

Sewer Right-to-Know
The Senate committee did not include the Community Sewer Overflow Right-to-Know Act, as was done in the House SRF reauthorization bill. NACWA expects this legislation to be marked up separately by the Senate EPW Committee as soon as next week.

Formula, Davis-Bacon Could Slow Progress on the Senate Floor

The SRF reauthorization bill now moves to the Senate floor where it may be held up by Davis-Bacon prevailing wage provisions and questions over the formula. Senators Alexander (R-Tenn.) and Barrasso (R-Wyo.) voted against the bill during markup (they were the only two of the EPW committee’s 19 Senators to do so) due to these concerns and EPW Ranking Member James Inhofe (R-Okla.) plans to lead an effort on the Senate floor to strip the Davis-Bacon provisions from the legislation.

The Senate bill also alters the SRF allotment formula by which States receive their capitalization grants for the first time since 1987. This will likely be a very contentious issue on the Senate floor as many states would see their percentages drop significantly under S. 1005. If the bill is passed out of the Senate, the formula question will again need to be resolved in conference as the House SRF reauthorization bill did not alter the existing formula and those in leadership positions in the House are from different states than those in the Senate.

NACWA Seeks Input, Urges Members to Contact Their Delegation in Support of S. 1005

NACWA has written several letters of support for S. 1005 and will continue to work with staff to shore up support in the Senate. The Association urges its members to weigh in with their Senators to ensure that the Senate takes up and passes the SRF reauthorization bill this year.

Please also provide any strategic input or comments on the SRF reauthorization bill to Pat Sinicropi, NACWA’s Legislative Director, at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or (202) 533-1823, or NACWA’s Legislative Manager, Byron DeLuke at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or (202) 833-4655.