Trump’s Pitch for Water Infrastructure Funds Leaves Groups Cautious

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By Amena H. Saiyid

Promises. Promises.

President-elect Donald Trump pledged during his campaign to make clean water a priority, to develop a long-term water infrastructure plan with city, state and federal leaders to upgrade aging water systems, and to “triple funding for state revolving loan fund programs to help states and local governments upgrade critical drinking water and wastewater infrastructure.”

But national drinking water and wastewater groups are hesitant to wager whether these promises made on the campaign trail will actually materialize as congressional appropriations.

“It is very questionable whether Congress would go along with tripling SRF (state revolving fund) funding, as it would mean adding roughly $4 billion to EPA’s budget,” said Dan Hartnett, Association of Metropolitan Water Agencies director of legislative affairs.

“Though the SRFs are very popular on Capitol Hill, in recent years there has also been a strong aversion among Republicans to giving EPA any additional funding.”

The state revolving fund programs for drinking water and clean water provide a combination of low-interest loans and grants to municipalities to upgrade, replace or rehabilitate infrastructure projects to provide clean and safe water.

Congress has the final say in how much these funding these programs will receive in the Environmental Protection Agency budget.

G. Tracy Mehan, executive director of government affairs at American Water Works Association, questioned congressional support for the funding.

“Unclear as to Congress given fiscal situation and push for increased defense spending and tax cuts even with a positive or dynamic budget scoring,” said Mehan, who was the assistant administrator for water at the EPA during President George W. Bush.

That said, “a tripling of the SRF would go a long way towards helping clean water utilities meet their infrastructure investment needs,” Nathan Gardner-Andrews, National Association of Clean Water Agencies chief advocacy officer, said in a Dec. 15 e-mail, adding “It wouldn’t totally solve the needs gap, but would help to narrow it.”

The EPA has identified water infrastructure investment needs totaling $655 billion nationwide that are eligible for funding through the clean water and drinking water state revolving fund programs over the next five to 10 years.

Gardner-Andrews said NACWA is “strongly supportive” of tripling funding of SRFs. Pointing to a Dec. 12 letter the association sent to Trump, Gardner-Andrews said NACWA was “ready to work” with the new administration to help make it happen.

AMWA represents large publicly owned drinking water utilities, while NACWA represents publicly owned wastewater utilities that include some that manage stormwater. AWWA is a professional society that conducts research on drinking water treatment and policy.

‘A Golden Opportunity’

Some observers even see Trump’s pledge to refocus government spending on infrastructure, which he envisions as “a golden opportunity” to accelerate economic growth, as no different than the American Recovery and Reinvestment Act (P.L.No. 111-5), the stimulus package that the 111th Congress enacted with bipartisan support and President Barack Obama signed into law in February 2009.

The ARRA provided $2 billion for the drinking water state revolving fund and $4 billion for the clean water state revolving fund, which Hartnett said is in the ballpark of where funding for the two state revolving funds would end up if Congress tripled their final fiscal year 2016 levels.

“But at this point it is not clear what baseline SRF amounts the president elect is proposing to triple, that is, is it the final FY16 appropriations, or fiscal year 2017 proposals? We’re still awaiting those details from the incoming administration,” Hartnett said.

For fiscal 2016, the drinking water state revolving fund received $863 million from Congress, while its clean water counterpart received $1.393 billion. Tripling these amounts would equate to $2.58 billion for the drinking water and about $4.17 billion for the clean water state revolving programs, respectively.

Under the current fiscal year, both revolving fund programs are being funded at the fiscal 2016 levels until April 28 under an interim spending measure.

Both the House and Senate will not only have to revisit fiscal 2017 spending but also decide how to appropriate funds for the upcoming fiscal 2018.

It’s unclear at this point whether Trump’s water infrastructure proposal, if and when formally requested, would be entertained in the leftover fiscal 2017 spending measure or in the fiscal 2018 spending measure.

The Senate Environmental and Public Works Committee did not respond to e-mail seeking comment on its support for Trump’s proposal. The House Appropriations Committee, where all federal appropriations discussions initiate, did not respond either.

‘Too Soon’

During the year’s final news conference on Dec. 12, Senate Majority Leader Mitch McConnell (R-Ky.) mentioned Trump’s infrastructure funding proposal, saying he wants to avoid a stimulus package similar to the ARRA package of 2009.

“We want to it see—I’m interested in seeing what is the administration going to recommend? And I think the details are really important,” McConnell said.

“What I hope we will clearly avoid, and I’m confident we will, is a trillion dollar stimulus. Take you back to 2009. We borrowed $1 trillion and nobody could find that it did much of anything.”

On the House side, Justin Harclerode, spokesman for the Transportation and Infrastructure Committee, which authorizes funds for EPA Clean Water Act programs, told Bloomberg BNA that Committee Chairman Bill Shuster (R-Pa.) has had discussions with the transition team about infrastructure funding.

But Harclerode said, “it’s too soon to have seen a fleshed out infrastructure proposal from the incoming administration yet.”

At the same, Harclerode didn’t close the door on Shuster’s willingness to entertain Trump’s proposal.

“The Chairman supports cost-effective and fiscally responsible investment in the nation’s infrastructure—from water infrastructure to roads and bridges to the aviation network and more—and he looks forward to working with the president-elect and his administration to identify ways in which we can ensure America has a 21st-century infrastructure,” Harclerode wrote in a Dec. 15 e-mail.

Democrats Supportive

House Transportation and Infrastructure Committee ranking member Peter DeFazio (D-Ore.) and House Energy and Commerce Committee ranking member Rep. Frank Pallone (D-N.J.) have sought increased appropriations for the state revolving funds.

In March, Pallone and DeFazio along with 94 other House Democrats urged the Appropriations Committee to provide a minimum of $2 billion each for both programs in fiscal year 2017 spending measure.

A Democratic aide told Bloomberg BNA the House Democrats will continue to support increases, irrespective of the change in administration.

To contact the reporter on this story: Amena H. Saiyid in Washington at asaiyid@bna.com

To contact the editor responsible for this story: Larry Pearl at lpearl@bna.com

For More Information

The Dec. 12 letter from NACWA to President-elect Trump is available at http://src.bna.com/kMK

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