House, Senate Hearings Focus on Local Water Infrastructure Needs, Financing

March 5, 2012
by Carolyn Berndt

Last week, the House Subcommittee on Water Resources and Environment and the Senate Subcommittee on Water and Wildlife held concurrent hearings focusing on local governments' extraordinary needs to improve the nation's water and wastewater infrastructure and potential innovative financing tools that could help close the gap between needs and expenditures. 

Mayors Gregory A. Ballard of Indianapolis and Stephanie Rawlins-Blake of Baltimore brought the local perspective, emphasizing the need to improve and upgrade aging water and waterwater infrastructure in their communities, the impact of unfunded mandates on communities and ratepayers and the need for new and innovated funding options. 

Numerous studies, including those by the Environmental Protection Agency (EPA) and the Congressional Budget Office, estimate that the cost of addressing the nation's clean water infrastructure needs over the next 20 years could exceed $400 billion. 

Additionally, the American Water Works Association last week released a report showing that the United States will need to spend $1 trillion in the next 25 years to maintain the current level of drinking water service and accommodate economic growth.

A combination of population growth, variations in water availability and aging water infrastructure are factors driving the need for significant investments in water infrastructure at the local, regional and national levels. These factors also present a challenge in meeting current and future needs of our communities.

"Our nation's water and wastewater infrastructure is aging, deteriorating and in need of repair, replacement and upgrading. This has resulted in frequent leaks, blockages, and inadequate treatment of pollutants," said House Subcommittee Chairman Bob Gibbs (R-Ohio). "The needs are especially urgent for hundreds of cities and towns around the nation trying to remedy the problem of combined sewer overflows and sanitary sewer overflows, and for communities lacking sufficient independent financing ability."

The House subcommittee focused on potential innovative financing tools, including public or private funding and investment mechanisms, to better enable local governments to finance wastewater and drinking water infrastructure systems. 

NLC supports water infrastructure funding through the Clean Water and Drinking Water State Revolving Loan Fund programs, as well as other alternative mechanisms of financing water infrastructure improvements and investments, including ones that lower the cost of borrowing and that will help leverage local funding, offer direct loans and loan guarantees from the federal government to cities, or remove the federal volume cap on tax-exempt bonds for water and wastewater infrastructure projects. 

Similarly, the Senate subcommittee hearing examined local government perspectives on water infrastructure. 

"Mayors across the nation are charged with replacing aging infrastructure and meeting the demands of a growing population while simultaneously coping with the aftermath of an historic recession," said Senate Subcommittee Chairman Ben Cardin (D-Md.). "The federal government must fulfill its responsibility to provide clean and safe water for all Americans."

"Given the incredible need, the incredible benefits from investment, I was extremely disappointed to see that EPA's FY13 Budget requested a decrease in funding for the Drinking Water and Clean Water State Revolving Fund programs for the second year in a row," said Sen. James Inhofe (R-Okla.), ranking member of the Senate Environment and Public Works Committee. 

The upcoming NLC Congressional City Conference will feature a workshop, "Federal and Local Tools to Finance Water and Transportation Infrastructure," that will take a closer look at the options Congress is considering to finance water infrastructure. The workshop will be held on Monday, March 12, from 2:00 to 3:30 p.m. and repeated on Tuesday, March 13, from 10:45 a.m. to 12:15 p.m.