The 111th Congress: Significant Progress But Much Water Infrastructure Work Remains

The 111^th Congress saw Democratic control of both chambers by significant margins and the White House. The Senate Democrats had a 60 vote supermajority for a time and the House Democrats held an overwhelming majority of the seats. Several key bills advanced through significant legislative hurdles, but much work was left unfinished at the end of the 111^th Congress, setting the stage for future legislative action. EPA Budget/Appropriations 2009 saw the passage of the American Recovery and Reinvestment Act stimulus program. Water was a big winner in this bill, gaining an additional $4 billion for the CWSRF and $2 billion for the DWSRF, with the state matching requirements entirely waived. 2009 also saw the passage of the FY2010 appropriations bills, which contained large increases in funding for the SRFs over FY09 numbers, particularly with respect to the Clean Water SRF. FY10 funding for the CWSRF jumped to $2.1 billion (up from $689 million in FY09) and DWSRF funding jumped to $1.38 billion (up from $829 million). The 2010 Appropriations process, however, proved to be more difficult. On February 1, 2010 the Obama Administration unveiled its FY 2011 Budget.  As promised in the President's State of the Union Address, many programs experienced significant cuts and the SRF programs were not immune.  Compared to the FY10 proposed level of $3.9 billion, the FY 2011 budget recommends $3.3 billion: $2 billion for the Clean Water SRF; and $1.3 billion for the Drinking Water SRF. While this funding level is disappointing compared with the FY10 enacted budget numbers, these amounts are still significantly higher than the FY09 enacted budget for both programs which totaled $1.5 billion. However, these numbers ultimately mattered little, as no final FY11 appropriations bill was passed. Rather, Congress passed a continuing resolution, funding the government at FY10 levels through early March, 2011. State Revolving Fund Reauthorization The clean water revolving fund has not been reauthorized since 1987, and the drinking water state revolving fund has not been reauthorized since 1996.The 111th Congress saw significant action on these programs. The House saw early passage of HR 1262, authorizing $19.4 billion over five years for wastewater infrastructure projects, including $13.8 billion for the CWSRF and $2.5 billion for the sewer overflow control grants program. The House also saw easy passage of HR 5320, which authorized $4.8 billion over three years to the DWSRF. The bill passed by voice vote, meaning in this case that the matter was so uncontroversial as to not warrant the time of a recorded vote. Also of note, both pieces of legislation applied “Buy American” requirements modeled after the Recovery Act, despite AGC objection. In the Senate, the Environment and Public Works Committee reported S. 1005, which authorized $39.191 billion for EPA water infrastructure programs over the next five years, and includes $20 billion for the Clean Water State Revolving Fund Program, $15 billion for the Drinking Water State Revolving Fund Program and $1.85 billion for Sewer Overflow Grants.  The legislation stalled however due to holds placed on the bill for its inclusion of Davis-Bacon prevailing wage application to the program. AGC and WIN Executive Committee members worked with key industry and congressional stakeholders to address these holds on the legislation in order to allow a vote by the full Senate, but ultimately a compromise could not be reached before time on the legislative calendar ran out. Water Trust Fund Legislation AGC and its WIN Coalition partners worked closely with allies on the Hill to get HR 3202, the “Water Protection and Reinvestment Act of 2009,” introduced in the House. The bill would authorize a five year $50 billion dedicated “Trust Fund” for clean water, drinking water and related infrastructure such as rehabilitating sanitary and combined sewer systems through dedicated user fees on products affecting the quality of water. AGC sponsored and participated in a briefing on Capitol Hill in an effort to educate staffers on the Clean Water Trust Fund (H.R. 3202). In a packed room of over 100 staffers, Shirley Jackson, former mayor of Atlanta who was also featured in Liquid Assets, explained the challenges faced by big cities that need to service large numbers of people with outdated and aging water systems. The audience also heard about the challenges faced by small towns forced to shoulder the debt burden from the mayor of Buhl, Idaho, Tom McCauley. They heard about the state of the construction and equipment industries from AGC and United Rentals and the environmental benefits from the National Wildlife Foundation. Finally, staffers heard an impassioned appeal for water and wastewater infrastructure from the D.C. Water and Sewer Authority. Since the briefing the bill has broken 40 co-sponsors.  While outlook for a vote on this bill during this Congress is slim, when it is reintroduced next Congress, the number of cosponsors in this Congress will have an impact on its prospects. Private Activity Bonds As co-chair of The Sustainable Water Infrastructure Investment Coalition, AGC made significant progress in the 11th Congress in advancing legislation which will remove the cap on Private Activity Bonds (PAB) for water and wastewater infrastructure.  Based on the water and financial industry estimates, removing the cap could facilitate at least $2 billion worth of private water investment in its first year and up to $5 billion or more annually as the market matures. The provision to remove the cap was introduced in both the House and the Senate as standalone bills, but was also added to many important, but stalled pieces of legislation. The House included the provision in two pieces of legislation that they sent over to the Senate side: HR 4849, “The Small Business and Infrastructure Jobs Tax Act of 2010”, (passed March 26, 2010) and HR 4213, the Tax Extenders bill, (passed just before the Memorial Day recess). The Senate however, failed to pass either bill. AGC and its Coalition partners then succeeded in getting the provision included in early versions of the legislation extending the Bush era tax cuts. However, the provision was ultimately left out of the compromise negotiated by Republicans and President Obama, and attempts to get it added back in were unsuccessful. AGC will be working early in the 112th Congress to build on previous support for the provision and identify legislative vehicles to get the provision voted on in both chambers.