Katherine Boyle, E&E reporter

A massive water infrastructure bill that recently passed the Senate Environment and Public Works Committee could face problems on the Senate floor thanks to the new, need-based loan formula on which it would rely.

S. 1005, would authorize $20 billion for the Clean Water State Revolving Fund and up to $14.7 billion for the Drinking Water State Revolving Fund. It also would change the way Clean Water State Revolving Fund cash is distributed to states, basing the new formula on a 2004 U.S. EPA study that looked at clean water infrastructure needs across the nation.

Sens. Lamar Alexander (R-Tenn.) and John Barrasso (R-Wyo.) were the sole votes against the legislation in committee. Alexander opposed the new loan formula, while Barrasso disagreed with Davis-Bacon wage requirements that were added to the bill.

The bill's sponsors -- EPW Chairwoman Barbara Boxer (D-Calif.), ranking member James Inhofe (R-Okla.), Water and Wildlife Subcommittee Chairman Ben Cardin (D-Md.) and subcommittee ranking member Mike Crapo (R-Idaho) -- disagreed on whether the loan formula would be a contentious point on the Senate floor.

We're going to face concerns about the formula on the floor," Crapo said. "There is such a great actual need that even this bill does not get us there. ... We'll make sure no state went below their relative need."

Boxer, on the other hand, predicted the formula "is going to please a lot of people."

Inhofe spokesman Matt Dempsey said the bill passed by the committee "allows for the best chance of passing the Senate."

The legislation "is based off the most current accurate estimate of need, raises the minimum percentage for each state [and] provides the most equity," he said. "Certainly, a few members will have complaints with the current bill. Senator Inhofe believes they should have an opportunity to have their voices heard on the Senate floor."

The National Association of Clean Water Agencies is supporting the bill but has taken no position on the loan formula, acknowledging the changes could spark controversy.

"We want the bill passed; let them work out the details," NACWA spokeswoman Susie Bruninga said. "I think we're looking at a fight on the floor, and I hope we can get it through."

EPA's 2004 study found the states with the largest reported publicly owned wastewater treatment plant works needs were New York and California, both of which require more than $20 billion to bring their infrastructure up to par. On a per capita basis, the District of Columbia, Hawaii and West Virginia demonstrated the most need.

More than three-fourths of the total needs are concentrated in 18 states, the report notes, while 20 states each reported less than 1 percent of the total needs. Altogether, the nation required nearly $200 billion for wastewater treatment needs.

S. 1005 gives each state an allotment value based on EPA's need estimates. Alexander's state of Tennessee, for example, received a 0.011019 value, while New York received the highest value given, 0.103531. The District of Columbia received the lowest value in the contiguous United States, 0.005.

"The formula will certainly be an issue on the floor," Bruninga said. "Davis-Bacon will certainly be an issue on the floor. We're hoping this year, since we don't have a veto threat looming, maybe that will provide the inspiration they need to work through those issues and finish the bill and get it to the president's desk."

Western senators, in particular, could take issue with the loan formula, citing pressing water needs and rising populations as reasons their portion should be increased.

House action
The House approved a companion bill, H.R. 1262, in March with a 317-101 vote. The legislation would provide $13.8 billion over five years for the Clean Water State Revolving Fund.

Much of the opposition in the House centered around Davis-Bacon wage requirements.

The House tackled the loan issue differently than the Senate, advising the administration to revise the formula rather than setting a new House version.

The House bill requests EPA use an existing formula for fiscal 2010 and 2011 but asks the administrator to set a new formula for funds exceeding $1.35 billion in fiscal 2012 and beyond. Like the proposed Senate formula, it would be based on water quality needs as assessed in the most recent survey developed by the agency.

House Transportation and Infrastructure Chairman James Oberstar (D-Minn.), who sponsored the bill, said he looks forward to working with the Senate during conference committee to resolve the differences related to the formula provisions in the two bills.

The Clean Water State Revolving Fund has never been reauthorized. It was created via amendments to the Clean Water Act in 1987.

Click here  to view the 2004 EPA study.