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Hearing Highlights Importance of Reauthorizing Loan Programs to Help American Communities Address Wastewater Infrastructure NeedsWashington, D.C. – The Water Resources and Environment Subcommittee today held a hearing to examine the benefits to states and local communities of federal water infrastructure financing programs, including the Clean Water State Revolving Fund (CWSRF) and Water Infrastructure Finance and Innovation Act (WIFIA) programs, and how those programs may be improved to help communities improve their water infrastructure. The Subcommittee heard witness perspectives from throughout the water infrastructure project application and construction pipeline. Witnesses discussed the importance of the CWSRF and WIFIA programs to states’ and local communities’ ability to finance their water infrastructure needs, including for smaller and rural communities, the need to reduce red tape and streamline access to assistance, and support for reauthorizing the programs and maintaining flexibility for those who use the programs. Subcommittee Chairman Mike Collins (R-GA) began by asking the witnesses what’s working and what’s not in the CWSRF and WIFIA programs, and how Congress could improve the programs’ efficiency and reduce red tape:
All the witnesses highlighted the need to cut red tape and streamline program efficiency. Tony Hillaire, Chairman of the Lummi Nation, said red tape can discourage Tribes from taking advantage of water infrastructure funding and called for streamlining the environmental review process for water infrastructure projects: “The federal funding system is overly complex and fragmented, requiring Tribes to navigate multiple agencies—IHS, EPA, USDA, and Bureau of Reclamation—each with different eligibility criteria, applications, and reporting requirements. This bureaucracy discourages many Tribes from applying and exacerbates infrastructure disparities…. This extensive permitting process demands considerable time and coordination, an especially heavy burden. While Congress has made efforts to streamline environmental reviews through MAP-21, and the FAST Act, those reforms largely focus on transportation projects, not water infrastructure. We need a streamlined process for water infrastructure.” Jeff Walker, the past president of the Council of Infrastructure Financing Authorities (CIFA) and testifying on behalf of CIFA, discussed how CWSRF loans provide an effective method of renewable financing and are important to keeping wastewater bills down for customers: “Clean Water SRF loans save real money – now and in the future. A low interest SRF loan can cut the cost of financing by more than 50%, which directly impacts today’s household wastewater bills. At the same time, loan repayments help build a permanent and sustainable source of revolving funds to provide affordable financing for water infrastructure projects in the future, impacting future household wastewater bills.” Subcommittee Vice Chairman Dave Taylor (R-OH) and Walker further discussed the benefits of utilizing CWSRF funds, especially for small and rural communities, and how loans – compared to grants – can be better leveraged to finance more of states’ and communities’ needs:
Walker highlighted the CWSRF’s ability to help small communities address their clean water needs: “More than half of Clean Water SRF subsidized loans (55%) are provided to communities with populations of less than 3,500, many of whom can’t qualify or will pay higher interest rates in the municipal bond and private lending markets. Without financing from the Clean Water SRFs, these communities are more likely to experience unreliable household wastewater services and poor water quality, which can result in exposure to deadly and debilitating waterborne diseases that are preventable.” Rep. Eric Burlison (R-MO) and Walker discussed the importance of state flexibility, the benefits of the CWSRF program being largely run by the states, and how too many Congressional mandates increase the costs of water infrastructure projects:
In his testimony, Walker noted the importance of the state flexibility provided by the CWSRF: “…[T]he Clean Water SRFs are effective because the programs are customized by states to meet the unique needs of the communities they serve…. Providing greater flexibility to state-run Clean Water SRFs can reduce costs for construction, compliance and administration of projects, while maintaining protection for human health and the environment.” Mike Matichich, Economic and Financial Services Consulting Lead for Jacobs and testifying on behalf of the United States Chamber of Commerce, and Dan Buckley, Preconstruction Executive Mid-Atlantic for Garney Construction and testifying on behalf of the National Utility Contractors Association, both highlighted the importance of reauthorizing the CWSRF and WIFIA programs. Matichich said, “The creation of the WIFIA program in 2014 by this Committee was a very important addition to the suite of federal assistance for water infrastructure. The WIFIA program filled a needed gap in the water finance landscape by broadening assistance to a wide range of borrowers and project types and giving larger projects access to credit assistance that otherwise would have been difficult to obtain through the SRF programs…. The CWSRF and WIFIA programs are a vital part of the financing solution to this challenge, by helping many water systems address compliance and community driven needs that are essential for the health and welfare of our citizenry and to provide an important foundation for economic growth and sustainability for our communities.” Buckley said, “The Water Infrastructure Finance and Innovation Act of 2014 established the WIFIA program – another tool that has helped meet America’s water infrastructure needs. WIFIA’s broader eligibility requirements have helped expand access to financing for communities across the country, and we call on Congress to build on the program’s successes by reauthorizing WIFIA and the State Infrastructure Financing Authority WIFIA (SWIFIA) programs alongside the SRFs.” More information about today’s hearing is available here. |
