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Today, the Administration released its Fiscal Year (FY) 2017 budget for the Environmental Protection Agency (EPA), requesting a dramatic cut to the Clean Water State Revolving Fund (CWSRF) program of over $414 million, a surprising and disappointing request in a final budget from an Administration that is trying to make clean water a centerpiece of its legacy. The proposed cut to the CWSRF pays for other Administration priorities elsewhere in the Administration’s budget, including an increase of $158 million for the Drinking Water State Revolving Fund (DWSRF) program and $240 million more for enforcement efforts. While NACWA supports an increase for the DWSRF, we do not believe the increase should come at the expense of investments in clean water. The Administration’s overall request for EPA is $8.267 billion, a $127 million increase over this current fiscal year.

Below is a chart outlining specific spending levels requested by the Administration for FY17:

In addition to the top line budget numbers, the Administration’s request contains $15 million to begin making loans under the Water Infrastructure Financing Innovation Act (WIFIA) which is a new loan program established in 2014 under the Water Resources Reform and Development Act (WRRDA). The Administration’s proposed funding level for WIFIA could potentially subsidize up to $1.8 billion in matching funds for project financing in the form of direct or guarantee loans. However, WIFIA loans are designed to provide financing for large water and wastewater projects that are regionally significant and not for projects designed to replace aging infrastructure or increase clean water treatment at the plant. The Administration has also requested an additional $22 million for the Water Infrastructure and Resiliency Finance Center which the Administration established to provide technical assistance to small and medium sized communities for project financing activities.

NACWA will be tracking budget developments closely and strongly advocating that the Administration’s proposed funding cuts be rejected by Congress as it undertakes to write a final spending blueprint for FY17. NACWA will keep its members informed as budget negotiations move forward.