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House Appropriators Begin Work on FY 2019 Spending Bills

Even though Congress may not take final action on fiscal year 2019 appropriations until after the midterm elections, House appropriators are making a concerted effort to mark-up and report all twelve spending bills to the House floor by June.  This week, a handful of the House Committee on Appropriations’ Subcommittees unanimously approved the Energy and Water Development, Legislative Branch; Military Construction, Veterans Affairs; Agriculture; and, Commerce Justice, Science appropriations bills. Below are select summaries of the Agriculture and Energy and Water spending bills.  On May 16, the House Committee on Appropriations will have a Full Committee markup on the FY 2019 Energy and Water, and Agriculture, Rural Development, Food and Drug Administration, and Related Agencies appropriations bills.

FY 2019 Agriculture Appropriations Bill

The bill provides $23.27 billion in discretionary funding, which is $14 million above the fiscal year 2018 enacted level.

Natural Resources Conservation Service

  • $150 million is appropriated for Watershed and Flood Prevention Operations, of which, $50 million will be immediately available for flood prevention, watershed protection and other activities.
  • $10 million is appropriated for the Watershed Rehabilitation Program, of which, $5 million is for projects to rehabilitate high-hazard dams and other structures.

Rural Utilities Service

  • $1.45 billion for rural water and waste program loans
  • $637 million in water and waste grants
  • $620 million for loan and grants including the Broadband Loan, Community Connect, Distance Learning and Telemedicine programs
  • Defines rural and rural areas to be a city, town, or unincorporated area that has a population of no more than 20,000 which would be an increase in population from the present 10,000 population threshold

FY 2019 Energy and Water Appropriations Bill

U.S. Army Corps of Engineers

  • $7.28 billion, an increase of $451 million above the fiscal year 2018 enacted level
  • Provides $128 million for surveys and detailed studies, and plans and specifications of projects prior to construction
  • Provides for six new study starts during fiscal year 2019
  • $2.323 billion for construction of river and harbor, flood and storm damage reduction, shore protection, aquatic ecosystem restoration, and related projects
  • Provides for five new construction starts during fiscal year 2019
  • $1.6 billion in funding from the Harbor Maintenance Trust Fund

Bureau of Reclamation

  • $1.56 billion providing $75 million above the fiscal year 2018 enacted level.
  • $35 million for the California Bay-Delta Restoration program
  • $134 million for water storage projects authorized under WIIN

Policy Riders:

  • Repeals the Waters of the United States Rule

House Takes Up White House Rescissions Package

This week, the Office of Management and Budget transmitted to Congress a rescission request to Congress to cancel $15.4 billion in unspent funds from years prior to the current fiscal year 2018.  The White House has indicated that it also intends to propose at least another $10-billion rescission later this year that might impact Fiscal Year 2018 program funding.  The transmittal triggers a 45-day clock. If Congress fails to pass a final rescission within 45 days, then the targeted spending becomes available to the impacted agencies.

The House Republican leadership swiftly introduced the rescission legislation and indicated that the legislation will bypass committee consideration and be debated and voted on by House membership in short-order.  A majority of the amount to be rescinded is from $7 billion from the Children’s Health Insurance Program, which the Congressional Budget Office has evaluated and determined that any such spending cut would not impact the program’s delivery of services.  Below is a select summary of the water and environment specific rescissions.

U.S. Department of Agriculture – Natural Resource Conservation Service

Watershed and Flood Prevention Program

  • Proposed Rescission: $157,482,456
  • Rescinds $107 million from the Emergency Watershed Program
  • Rescinds $50 million from the Watershed and Flood Prevention Program

U.S. Department of Agriculture – Natural Resource Conservation Service

Farm Security and Rural Investment Program

  • Proposed Rescission: $499,507,921
  • Rescinds $144 million from the Environmental Quality Incentive Program
  • Rescinds $356 million from conservation programs

U.S. Department of Agriculture – Rural Utilities Service

Rural Water and Waste Disposal Program

  • Proposed Rescission: $37,000,000
  • Rescinds $37 million in carryover balances

U.S. Department of Agriculture – Forest Service

Land Acquisition Program

  • Proposed Rescission: $16,000,000
  • Rescinds $16 million in prior year balances

U.S. Environmental Protection Agency

Environmental Programs

  • Proposed Rescission: $10,000,000
  • Rescinds $10 million in prior year balances
  • Specifies that rescission would reduce funding for water quality research and support grants

Senate Appropriators Review USDOI FY2019 Budget

On May 9, the Senate Committee on Appropriations Subcommittee on Interior, Environment, and Related Agencies held a hearing to review the U.S. Department of Interior’s (USDOI) FY 2019 (FY19) budget request.  USDOI Secretary Ryan Zinke testified at the hearing.

Chairman Lisa Murkowski (R-AK) opened the hearing stating that the FY19 budget request for USDOI programs within the jurisdiction of the Subcommittee is $10.5 billion, which is about $2.5 billion below the enacted level.  Murkowski emphasized the need for Congress to pass final appropriation bills to ensure that agencies, including USDOI, operate efficiently, seemingly setting the stage for the subcommittee to recommend a higher spending level when it marks up a spending bill.

During his testimony, Zinke stated that “ensuring the availability of water is central to the Department’s resource stewardship mission and is vitally important to communities across the West.”  As a result, the FY19 budget request allocates $1.0 billion for the U.S. Bureau of Reclamation’s water resource programs.  Of the $1 billion, $447.0 million is included for construction, planning, and management of water and energy projects and programs, and $444.0 million for water and power facility operations, maintenance, and rehabilitation.  The FY19 budget also includes $10.0 million to continue funding of WaterSMART water conservation grants, and $3.0 million for Title XVI water recycling reuse research grants.

While the hearing’s discussion focused mostly on public land and state specific issues, Murkowski asked Zinke to explain his plan to reorganize USDOI.  Zinke explained that USDOI has not been reorganized in 150 years, and the current method of exercising oversight over USDOI resources and properties is unnecessarily complicated.  The complication, Zinke explained, is a consequence of multiple agencies within the Department, that oversee the same resources and properties, being isolated from one another.  To resolve this problem, Zinke is recommending reorganizing the U.S. into thirteen unified regions, so that agencies overseeing similar resources and properties are organized within the same region to facilitate better operations.  Additionally, Zinke explained that this reorganization recommendation would address issues surrounding the National Environmental Policy Act (NEPA) and permitting processes.  Under the proposed reorganization, all stakeholders would be involved in the NEPA process at the beginning to avoid the issues that arise from the current practice of agencies independently producing biological opinions.  Concerning permitting, the reorganization plan would organize officials from the various bureaus into the same region to better reflect the realities of the region in question.  Lastly, the plan would have more permitting decisions be made at the regional level rather than in Washington D.C. 

Senate Hearing on Status of Puerto Rico Energy Grid

On May 8, the Senate Committee on Energy and Natural Resources held a hearing on the restoration of Puerto Rico’s electric grid that was destroyed by Hurricane Maria in September 2017.

Chairman Lisa Murkowski (R-AK) opened the hearing stating that there are three tenets to follow when addressing Puerto Rico’s broken grid system: 1) making the grid more resilient to future weather events, (2) bringing the timeframe for repairing the grid on par with the rest of the United States, and (3) bringing down the overall cost of electricity compared to pre-storm prices.

Murkowski expressed concern over whether the Puerto Rico Electric Power Authority (PREPA) will be able to handle the rebuilding efforts on its own. Walter Higgins, recently appointed as Chief Executive Officer for PREPA replied, “It’s going to be a challenge and we are probably going to get some help by Federal Emergency Management Agency (FEMA) for that, but our people feel they are ready.” Higgins stated that PREPA has submitted requests for reimbursement of $1.6 billion in projects, $997 million of which has been advanced by FEMA.

Higgins provided the committee with the following update on the status of power line restoration:

  • 25% of all customers now have power;
  • 80% of transmission lines are restored;
  • 74% of the towers, poles, conductors, and insulators have been repaired; and
  • 52,000 power poles, 10,000 transformers, and 29 million feet of power cables have been delivered to the Island, representing approximately 95% of the supplies required for the line restoration effort.

In his written testimony, Higgins stated, that the Governor of Puerto Rico “envisions possibly engaging a private operator for the Island’s transmission and distribution system through an effective mechanism,” (e.g., long term concession agreement) and that “this transformation also contemplates a private ownership or operation of existing PREPA assets as well as development of greenfield generation projects.”

Charles Alexander, Director, Contingency Operations and Homeland Security, USACE testified that USACE’s authority to stay in Puerto Rico rests with FEMA.  In response to Murkowski’s concerns, Bruce Walker, Assistant Secretary, Office of Electricity Delivery and Energy Reliability, U.S. Department of Energy, made several recommendations:

  • Mutual aid agreements need to be finalized by PREPA and the Governor of Puerto Rico;
  • Puerto Rico Energy Commission (PREC) should coordinate a joint study with the Puerto Rico Telecommunications Board to determine and enforce safe loading requirements for utility poles carrying both electric and telecommunications infrastructure;
  • Electricity transmission towers installed specifically for temporary emergency restoration should be considered for replacement, potentially by monopoles; and
  • PREC should finalize microgrid regulations.

Also, testifying at the hearing were: Christian Sobrino-Vega, President of the Government Development Bank and Chairman of the Board of the Fiscal Agency & Financial Advisory Authority, Government of Puerto Rico; José Román Morales PE, Comisionado Asociado-Presidente Interino, Comisión de Energía de Puerto Rico; and, Rodrigo Masses, President, Puerto Rico Manufacturers Association.

Senate Committee Kicks-Off WRDA Process

On May 8, the Senate Committee on Environment and Public Works released a bipartisan Water Resources Development Act (WRDA) bill entitled America’s Water Infrastructure Act of 2018 (S. 2800), along with a section-by-section summary of the bill.  On May 9, the Committee held a hearing on S. 2800 with stakeholders.  A second hearing on May 17 is slated to receive testimony from the Administration with a markup planned by the end of the month.

At the hearing, there was broad bipartisan support and excitement about the bill.  Chairman John Barrasso (R-WY) opened the hearing explaining that the bill will support the nation’s economic competitiveness by deepening ports, fixing aging irrigation systems, increasing water storage, and protect public health and safety by repairing drinking water and wastewater systems.  Barrasso also highlighted that the bill will create an addition to the cost-share framework that will allow local stakeholders a greater role in prioritizing U.S. Army Corps of Engineers (USACE) projects.

Ranking Member Tom Carper (D-DE) noted that the bill reinvests in USACE, authorizing new funding and planning requirements for projects at the individual USACE districts to help reduce the backlog of unfunded projects.  Carper highlighted that the bill supports infrastructure resiliency through investments in natural green infrastructure, in addition to grey infrastructure, that will not only protect coastal communities, but also help protect against future natural disasters.

Senator John Boozman (R-AR) asked Kristina Swallow, President of the American Society of Civil Engineers (ASCE), about the increasing infrastructure funding needs gap.  Swallow stated that ASCE projects a $750 billion-dollar funding gap over the next 20 years for water and wastewater needs.  She stated that the SRF WIN Act (S. 2364) combines the best parts of the State Revolving Fund and the Water Infrastructure Finance and Innovation Act program and would be another tool in the toolbox to help local agencies and communities.

Senator Shelley Moore Capito (R-WV) asked witnesses about the bill’s provision that mandates the U.S. Environmental Protection Agency to establish a competitive grant program that promotes workforce development within the water utility sector.  Dennis Sternberg, Executive Director of the Arkansas Rural Water Association, explained that the water sector suffers from an aging workforce that lacks a younger workforce to replace it.  However, Sternberg said that the bill’s provision helps to jumpstart the process of building a younger workforce.

Testifying at the hearing were Pat Riley, Advisory Committee Member of the Family Farm Alliance, Dennis Sternberg, Executive Director of the Arkansas Rural Water Association, Kristina Swallow, President of the American Society of Civil Engineers, Jeffery Bullock, Secretary of State of the State of Delaware, and Tony Pratt, President of the American Shore and Beach Preservation Association.

WOTUS Delayed

The U.S. Environmental Protection Agency (USEPA) will release its final proposed rule narrowing the Waters of the U.S. (WOTUS) Rule in September 2019.  The new 2019 deadline counters USEPA Administrator Scott Pruitt’s remarks at the House Committee on Subcommittee on Environment hearing when he told Members that the rule will be finished at the end of this year.

The decision to extend the deadline was included in the Office of Management’s just published Spring 2018 Unified Agenda of Regulatory and Deregulatory Actions.  The agenda highlights the Administration’s priorities for regulatory initiatives and the pending time tables for such efforts.  According to the agenda, during the next 12 months, federal regulatory agencies plan to issue 209 final deregulatory actions, versus 47 regulatory actions.

Legislative Activity This Week

H.R. 221, Hydrologic Services Improvement Amendments Act – Reported out of the House Committee on Natural Resources as amended by unanimous consent.

New Legislation

S. 2800, America’s Water Infrastructure Act of 2018. – Sen. John Barrasso (R-WY)

H.R. 5688, To amend the Water Resources Development Act of 1990 relating to the operation and maintenance of navigation facilities, and for other purposes. – Rep. Cheri Bustos (D-IL)

H.R. 5726, To authorize the use of certain contributed funds for activities relating to operational documents for non-Federal reservoirs, and for other purposes. – Rep. Jim Costa (D-CA)

H.R. 5720, To deauthorize a portion of a project in California, and for other purposes. – Rep. Ken Calvert (R-CA)

Reports and Regulation

USEPA Five-Year Review of 2012 Recreational Water Quality Criteria – U.S. Environmental Protection Agency’s five-year review as mandated by the BEACH Act amendments to the Clean Water Act of the 2012 RWQC.

Memorandum on the 2018 Direction to Wildland Fire Leadership – Letter to U.S. Department of the Interior agencies from U.S. Department of Agriculture Secretary Sonny Perdue and U.S. Department of Interior Secretary Ryan Zinke on the wildland fire leadership in 2018.

Congress Next Week

May 16, 2018

House Committee on Energy and Commerce – Hearing on Legislation Addressing New Source Review Permitting Reform

Senate Committee on Appropriations – Hearing on U.S. Environmental Protection Agency FY 2019 Budget

House Committee on Appropriations – Full Committee Markup on FY 2019 Energy and Water and Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Bill

May 17, 2018

Senate Committee on Environment and Public Works – Hearing on S.2800, America’s Water Infrastructure Act of 2018

The House is scheduled to vote on the Farm Bill otherwise known as the Agriculture and Nutrition Act of 2018 (H.R. 2) next week.