Private Water Organizations Oppose Free Lunch

The Water Industry Council representing contract operators on Jan. 25 told AMSA’s Director Ken Kirk that it would not endorse the final draft of the WIN Coalition recommendations to Congress on funding municipal water and wastewater infra-structure needs in the U.S.

The Association of Metropolitan Sewerage Agencies is leading an effort by the municipal clean water industry to obtain $57 billion in federal grants over five years to jump start a $1-trillion local, state and federal investment in water and sewer systems.

As proposed by the Water Infrastructure Network, federal grant applicants could receive up to 75% of project costs in a direct grant and also be eligible for a subsidized, or principal-free "loan" for the remaining 25% of the project cost. The only test of need would be environmental, not financial.

State Revolving Fund administrators have warned that the proposed program would put political pressure on them to issue grants rather than loans, especially if the total amount of funds were considerably increased. Responsible communities are now repaying over $30 billion in SRF loans.

WIC wants the following points considered in any new federal clean water funding program:

  • Any proposed replacement for the SRF program should issue loans to municipalities or their private partners based on the current criteria of environmental and economic need.
  • Up to 30% of the available funds should be reserved for "disadvantaged" communities as defined by each state. Those disadvantaged communities should be eligible to receive principal or interest forgiveness of a loan as long as the anticipated economic life of the project. The entire cost of a project may be funded in this manner if the state so chooses.
  • The disadvantaged communities receiving principal or interest forgiveness should be required to document its effort to determine the most cost-effective procurement and construction strategy.
  • Technical assistance should be limited to pilot demonstrations of technology developed either publicly or privately.