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August 2, 2010

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Government Relations

NAWC joins the Water Innovations Alliance

The National Association of Water Companies (NAWC) has joined The Water Innovations Alliance, an industry association focused on reducing regulatory barriers, developing new funding, increasing collaboration and raising awareness for cutting-edge water technologies and the problems they solve.

“The private water service industry is uniquely positioned and incentivized to lead the industry in technology implementation”, said Michael Deane, NAWC executive director. “The NAWC is proud of its members’ record for technology advancement: from providing water reuse for LEED certified green buildings, to significant investments in water quality research, to finding and delivering energy savings and water conservation opportunities in treatment and distribution.

“NAWC commends the Water Innovations Alliance for its solid work in the information technology sector and recognizes this important contribution to the industry as a whole. We are eager to support the Alliance’s objectives and to further this partnership between cutting edge innovators and the innovative companies who implement these technologies.”

NAWC will participate in the Water Innovations Alliance Conference in Chicago from September 27-29, 2010.


House Leaders Continue to Seek Passage of Water Bond Bill

The House Ways and Means Committee Chairman Sander Levin plans to unveil new jobs legislation that would extend Build America Bonds and other municipal bond initiatives that are set to expire at the end of the year. The bill, H.R. 5893 also includes many of the same bond provisions in earlier jobs legislation that was passed by the House but faced hurdles in the Senate. The new legislation is a more streamlined version of the previous bill, and it is hoped that the bill will pick up more support and have a better chance of enactment than its predecessor.

The NAWC-supported proposal that would allow for the sale of PABs for water and sewer facilities without state volume cap limitation was included in the Levin proposal. The Sustainable Water Infrastructure Investment Act of 2010, S. 3262 and H.R. 537, has already passed the House twice this year.

The water proposal’s low-cost and creative approach to tapping private capital for water infrastructure investment projects continues to be an appealing measure to encourage investment in water projects that would sustain jobs and create small business opportunities. “The bill really is a win-win; each and every water project undertaken as a result of its ultimate passage will be vital to maintaining and protecting public health and the environment,” said Michael Deane, executive director of NAWC.

According to the Environmental Protection Agency (EPA) and the U.S. Government Accountability Office (GAO), a $500 billion gap exists in funding and needs to maintain critical water infrastructure. In practice, this “gap” and infrastructure neglect can have devastating consequences. Last year American communities suffered more than 240,000 water main breaks and billions of gallons of overflowing combined sewer systems, causing contamination, illness, property damage and disruptions in the water supply. The water pipe break in Massachusetts last month left nearly 2 million people without water and placed an enormous strain on local residents and small businesses. One original co-sponsor of S. 3262, Senator John Kerry (D-Mass.), faced the need for water infrastructure repair and maintenance first hand and updated his constituency on the water main break via Twitter.

Congressman Pascrell (D-N.J.), along with 54 bipartisan and geographically diverse colleagues, led this bill to passage in the U.S. House of Representatives. Congressman Pascrell spoke on the importance of this policy change, “Our nation’s job deficit and deteriorating water systems have gotten to the point that if you randomly pick up a newspaper in any American city, there’s a good chance you find a story about a company’s job cuts or a community’s water main break — maybe both. Taxpayers cannot be expected to foot the entire bill for all of the repairs and updates that our water infrastructure needs. Our legislation will encourage public-private sector partnerships to secure needed resources.”

Senators Menendez (D-N.J.) and Mike Crapo (R-Idaho) and 7 bipartisan colleagues continue to lead the charge in the U.S. Senate to bring the bill to final passage. “Part of rebuilding our economy for the 21st century is renovating the infrastructure that helps our communities prosper,” said Menendez. “Many of our communities in New Jersey have been challenged by aging and deteriorating water and sewer systems, which not only jeopardizes the health of our families but also puts significant strain on local budgets. With this legislation, we can help local governments afford water and sewer renovations without burdening taxpayers, and we can create thousands of jobs.”

“Many small communities need and deserve federal support to comply with federal water and wastewater guidelines,” Crapo said. “This bill would allow local communities to leverage private capital markets in combination with other financial mechanisms to finance water and wastewater infrastructure projects. It makes financial sense for communities and will improve public health and water quality.”


Reid Unveils Highly Anticipated Energy Bill, Including WaterSense Incentives

After several attempts to pass a comprehensive energy bill, Senate Majority Leader Harry Reid (D-Nev.), drew on at least 10 separate energy and oil spill-related bills by Democratic senators in assembling a package he wants the Senate to vote on before leaving for recess.

Of note to the water community, the bill is likely to include a Home Star energy efficient retrofit program that would provide direct incentives to consumers to reduce energy and water use. There are two specific consumer programs of interest.

The Silver Star Section would allow homeowners that purchase at least $300 in WaterSense products to receive a $150 rebate. Eligible WaterSense products include showerheads, toilets, faucets and outdoor irrigation systems. The Gold Star Section would allow homeowners to receive a $500 rebate for a 20 percent reduction in potable water use. To implement these programs, the Department of Energy is instructed to develop a methodology to measure whole home water savings within six months of the bill’s passage.

Additionally, funds would be made available to states to provide interest rate reductions, credit enhancements, revolving loan funds or other debt instruments or financial products to maximize leverage and to support widespread deployment of energy efficiency and water efficiency finance programs.


House Passes $4.8 Billion Drinking Water State Revolving Fund Reauthorization

Before leaving for a summer recess, the House of Representatives passed a Drinking Water State Revolving Loan Fund (SRF) reauthorization. The infrastructure bill, H.R. 5320, sponsored by Henry Waxman (D – Calif.) and Ed Markey (D – Mass.), reauthorizes EPA's drinking water state revolving fund for $1.4 billion for fiscal 2011, $1.6 billion for fiscal 2012 and $1.8 billion for fiscal 2013.

The NAWC has been encouraged by priorities in this bill that use sustainability and long term viability as evaluation criteria for funding and uses funding as a positive incentives to encourage public water systems to improve their managerial capacity and reduce their environmental impact. In a letter to the Energy & Commerce Committee, the NAWC wrote, “NAWC is encouraged that you would direct states to give additional weight to applications from utilities that have reviewed restructuring options – which is defined to include changes in ownership and consolidation with other water systems. Throughout the country, NAWC members have been successful in consolidating or restructuring small, non-viable and often non-compliant water systems into a larger and more environmentally and economically sustainable framework.”

For this bill, H.R. 5320, to become law, the Senate would have to pass its version of SRF reauthorizations, S. 1005 and then the three committees of jurisdiction would have to meet in conference to iron out the significant difference between the bills. Most involved are not optimistic about the chances for a reauthorization this year.


Water Resources Development Act (WRDA) Action in the House

The House Transportation and Infrastructure Committee approved a $6 billion Water Resources Development Act that authorizes funding for about 300 water and Army Corps of Engineers projects. Many view the bill as earmark-ridden and therefore controversial. In addition, many Republicans did not submit earmarked projects for funding.

The Senate has not introduced a companion bill, making it very unlikely that this bill will pass this year.


‘Infrastructure Bank’ Not to Be Funded This Year

House and Senate appropriators have signed off on their preferred version of a fiscal 2011 Transportation HUD bill — minus one of President Obama’s priorities, a multibillion-dollar infrastructure bank.
Meanwhile, stakeholders — including the U.S. Chamber of Commerce, groups representing states and private equity firms — continue to press for the idea, which is all but certain to be relegated to the dustbin for the second year in a row.

During a recent discussion organized by the Chamber of Commerce, Pennsylvania Governor Edward G. Rendell called for a federal infrastructure bank, saying it could serve as an important supplement to dwindling gas tax receipts coming into the Highway Trust Fund. Rendell, during his speech, said that such a bank must do more than just fund transportation; he mentioned water, wastewater and energy projects as well.
“The infrastructure bank is important because it can be the vehicle that can galvanize private capital,” the Democratic governor said. “It’s necessary because we don’t have a vehicle for regional and large-scale infrastructure projects.”

In his first budget, Obama proposed a $5 billion “infrastructure bank” that would give capital grants to state and local governments. It was to be administered by an independent body, but the proposal was never fleshed out beyond these rough guidelines.

Last year, appropriators didn’t fund the bank in part because the administration didn’t present a legislative proposal for creating it. In this year’s budget, Obama proposed a similar idea, although this time it was referred to as an “infrastructure fund,” and the request was trimmed to $4 billion.
Once again, the administration has not sent up a policy proposal for the slimmed-down fund, leaving lawmakers to guess at how it would be structured and how money would be spent.

In testimony before Congress, administration officials have indicated that the fund would be intended to function as a hybrid between a traditional infrastructure bank and the Transportation Department’s popular discretionary grants, administered through what is known as the Transportation Investment Generating Economic Recovery program.

In this manner, the fund would likely have the capacity to give out a combination of grants and loans, paired with private investment, for large-scale projects that serve entire regions.
Representative Rosa DeLauro (D-Conn.), has a bill to create an infrastructure bank (HR 2521), which is still awaiting action in three committees.