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Washington DC Update - June 2020

Scott Berry, Policy Director, US Water Alliance | June 26, 2020

Infrastructure and Conservation in Congress and EPA Issues New Regulations

Lots of interesting action this month on the regulatory and the legislative fronts. Democrats in the House of Representatives introduced HR 2, the Moving Forward Act, a long-awaited $1.5 trillion infrastructure package.This large bill is based in part on a $760 billion infrastructure framework unveiled in January by House Democrats. Parts of that as well as more recent legislation on surface transportation, energy, and other infrastructure were stitched together into a larger master proposal that lays down a clear marker of where Democrats want to go in the infrastructure space. For water, the package would invest $25 billion into the Drinking Water State Revolving Fund (SRF), including a new program to assist drinking water systems with projects related to removing emerging contaminants like PFAS. On the wastewater side, the bill would invest $40 billion in the Clean Water SRF. The bill also exempts water and sewer projects form the state allocation cap on private activity bonds, potentially unlocking billions in private investment in water infrastructure.

The legislation, expected to pass the House, is scheduled for a vote the week of June 29th. Prospects in the Senate are dim though, as Senate Republicans are disdainful of the bills large price tag and would prefer a much smaller scale bill. The most likely outcome in the Senate, if they are to pass any infrastructure legislation, is to bundle existing surface transportation, water resources, and drinking water legislation into a larger bill and pass that. There is some support among Senators for this approach and it could likely win bipartisan support. Senate Majority Leader McConnell has not been especially vocal about his plans and the executive branch has been equally mum.

In perhaps better news, Congress did pass (and President Trump signed into law) the Great American Outdoors Act this month, which primarily addresses the nation’s backlog of badly needed maintenance at its national parks. The bill also permanently authorizes $900 million annually in funding for the Land and Water Conservation Fund, a major funding mechanism for water conservation projects.

On the regulatory front, the Trump Administration finalized its new regulatory framework that deals with water quality certifications under Clean Water Act Section 401. This section gives states the right to certify that projects requiring permits comply with state water quality standards. New regulations from EPA now restrict the scope of state reviews — excluding issues like climate and air pollution that some states have used to issue de facto vetoes of such projects within their states. This rule was an implementation of a 2019 Executive Order designed to speed the implementation of pipeline projects across the country.

Another EPA action this month was the agency’s decision not to set national drinking water standards for perchlorate, a chemical found in rocket fuel, fireworks, and fertilizers. EPA acknowledged perchlorate can affect human health but determined the chemical doesn’t appear in enough public water systems, or at high enough levels, to cause concern. The decision is expected to result in litigation against the agency.