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Infrastructure Week Followed by Collapse of Discussions as House Prepares to Move Spending Bills

On the heels of last week’s annual Infrastructure Week lalapolooza, Wednesday’s meeting between President Trump, Speaker Pelosi, and Senate Democratic Leader Schumer cratered after three minutes when the political maelstrom of no collusion, no obstruction took center stage.   The collapse was not unusual, repeating the past two years’ failed attempts to legislate a new massive investment in the country’s public works ranging from water to roads to airports and ports.  As a result of the breakdown of yesterday’s meeting, it appears that the approach to address the nation’s failing infrastructure will be a piecemeal approach to respond to the deteriorating infrastructure situation.  The approach appears to be a bifurcated one, as House infrastructure committees develop separate pieces of legislation that essentially renew and boost funding levels for existing programs and the Committees on Appropriations in the House and Senate move forward with fiscal year 2020 spending bills that support federal infrastructure assistance programs.

In the House, it is increasingly likely that legislative approaches to renew U.S. Environmental Protection Agency’s state revolving loan fund program for clean water needs, expand the U.S. Bureau of Reclamation’s water recycling and desalination projects assistance programs, and create a new WIFIA-like western water projects assistance program will be the pathway, at least in the House, to move the infrastructure policy debate forward.  Transportation infrastructure needs remain the best hope for a significant investment as both the House and Senate committees with jurisdiction over transportation appear to be prepared to make the issue a top priority before the end of the year.  The challenge that remains, however, is the ability to find a financing tool that can deliver the billions of dollars necessary to rebuild the nation’s road and highway networks.

Water infrastructure policy continues to attract support, but all signs point to legislative action being completed next year, when the House and Senate will work to renew the Water Resources Development Act and will likely roll into this U.S. Army Corps of Engineers legislation.  At the same time, it looks increasingly likely that western water infrastructure needs such as storage, alternative water supply projects and technology innovation to enhance water conservation will move on a separate legislative track and possibly carried by an omnibus public lands bill in the coming year.  Regardless of the odds for passage of any infrastructure policies, the ongoing congressional interest in moving forward on the issue remains strong despite this week’s set-backs.

House Committee Advance FY2020 Spending Bills

Meanwhile in the absence of a clear path forward on infrastructure policymaking, the House Committee on Appropriations began approving spending bills.  Under the spending bills, most programs remain funded at current year spending levels or receive a slight increase, rejecting the Administration’s effort to slash program spending.  The Interior and Environment Appropriations Bill, that funds USEPA, would allocate $1.8 billion to Clean Water State Revolving Loan Fund Program and $1.3 billion to the Drinking Water SRF Program.  The low interest rate WIFIA program would be funded at $50 million with a directive to leverage $5 billion in new water infrastructure spending.  In a show of Congress’s commitment to help communities address stormwater management and recover such flows for reuse, the spending bill would allocate $90 million in grants assistance and represents a $30 million bump-up from the Administration request. A perennial favorite for elimination, regional water quality improvement programs like the Great Lakes and Chesapeake Bay Programs was rejected. Instead, program funding was boosted by $20 million delivering an almost $500 million to support water quality improvements at national geographic priorities.

The bill includes a significant increase for the U.S. Forest Service to address wildfire and forest management priorities.  For Wildland Fire Management the bill provides $5.21 billion, a $1.6 billion increase above the 2019 enacted level.  The bill includes funding increases for several key forest health and watershed protection programs:

  • $26.8m for hazardous fuels reduction.
  • $45m for State and Private Forestry Programs (State Fire Assistance/FireWise/Cooperative Fire Assistance).
  • $10m for forest and rangeland research and development activities.
  • $5m to reestablish the Collaborative Forest Landscape Restoration Fund.
  • $28m for Forest Service road maintenance and construction.

At the U.S. Bureau of Reclamation, a similar process unfolded as the committee approved the Energy and Water Development Appropriations Bill.  Under this measure, water recycling project assistance under Title XVI is slated to receive $63 million and the WaterSmart Program that funds water innovation grants would receive $60 million.  Funding in support of California water storage projects authorized under the WIIN Act is allocated $40 million.  On the matter of PFAS, the bill provides for $3 million to support the establishment of a Maximum Contaminant Level under the Safe Drinking Water Act and another $10 million to support research efforts into PFAS for purposes of listing PFAS as pollutant under Superfund.

Regulatory riders that have been the bane of efforts to pass spending bills are limited in the bills and focus on limiting reprogramming funding, agency reorganizations, and ensuring that minimum levels of program funding are compiled within the coming budget year.  In one area, however, the committee expressed its frustration over USEPA’s inability to issue final regulatory standards by the end of 2019 to ensure that drinking water fixtures are lead-free.

House floor action is expected on both bills by July 4th, allowing the Senate Committee on Appropriations to develop Senate spending bills by September that would lead to final negotiations between the House and Senate to avoid a shut-down of the government or a Continuing Resolution on October 1 when the new fiscal year begins.

Passage of Disaster Assistance Bill Before Memorial Day Recess

As tornadoes hammer the U.S. Southeast and the Atlantic hurricane season officially starting on June 1, Congress still has yet to pass a disaster relief in response to the 2018 disaster events.  The week started optimistically, with expectations that Congress would pass a disaster supplemental package to assist communities impacted by 2018 wildfires, flooding and extreme weather events.  Hopes of passing a disaster bill were lessened earlier this week when immigration-related provisions, requested by the Administration to be added to the bill, seemed to have complicated the prospect of a bipartisan agreement.  However, it appears that the House, Senate, and White House have come to an agreement that provides $19.1 billion in funding.  Select provisions include:

  • $414 million for the U.S. Environmental Protection Agency, of which $349.4 million is state revolving funds to repair damaged drinking water infrastructure.
  • $720m for the U.S. Forest Service for wildfire suppression and post-fire remediation.
  • $1b to the USACE to enhance resiliency for future coastal and flood emergencies and $740m to study and construct high-priority flood and storm damage prevention projects.
  • $300m for NOAA for fisheries and for improved forecasting.

As of this writing, Congress has yet to pass the disaster bill, but it is the desire of leadership in both chambers to pass the bill as soon as possible.  Congress has until this Friday to pass the bill before leaving on a week-long recess.  If no agreement is reached by Friday, passage of disaster relief legislation will be a top priority for Congress when Members return in June.

Legislation Introduced to Require Congress to Budget for Natural Disasters

Senator Mitt Romney (R-UT) introduced the Budgeting for Disasters Act, which would: remove the disaster relief and wildfire suppression upward adjustments to discretionary spending caps; raise the threshold to waive a point of order that an emergency designation is outside the budget caps from 60 votes to 67 votes; and, require a GAO study to review the relationship between emergency, disaster, and wildfire spending, including recommendations to reform qualifications for emergency spending.

Senate Examines PFAS Legislation

This week, the Senate Committee on Environment and Public Works examined a series of bills focusing on PFAS contamination and treatment.  During his opening remarks, Chairman John Barrasso (R-WY) stated that he intends to “negotiate and report a bipartisan legislative package, addressing PFAS pollution, this Congress.”  However, Barrasso explained that he could not support some of the legislation before the committee because of concerns over the bills’ “side-stepping the rulemaking process” that assesses risks associated with the chemicals and their rush to implement treatment practices when there is still scientific research to be conducted.  Barrasso also expressed concern “about Congress imposing superfund liability on parties that used these substances in good faith” if the parties were following best practices or regulations.

Lisa Daniels, Past President of the Association of State Drinking Water Administrators, and Director of the Bureau of Safe Drinking Water, Pennsylvania Department of Environmental Protection, testified to the financial complexities of addressing PFAS contamination from a water utility’s perspective.  As Daniels explained, states will not always be able to identify the responsible party of a specific contamination source.  When this happens, the responsibility of treatment falls upon water suppliers and utility customers to pay for treatment costs.  While it “has been suggested the Clean Water and Drinking Water State Revolving Funds (SRF) can provide grants” to pay for such costs, she stated the SRF does not have the resources provide such grants, while also supporting the other types of assistance the program already provides to water systems.  As a result, Daniels emphasized the need for alternative funding sources to support PFAS treatment.

Daniels reiterated the need for the federal government to provide alternative funding sources to assist water utilities in PFAS remediation when responding to Senator Sheldon Whitehouse’s (D-RI) question about what Congress needs to do to address PFAS.  She highlighted that it could cost a utility anywhere from thousands of dollars to millions of dollars to implement treatment infrastructure and practices, and the SRF simply cannot support such costs in addition to all the other assistance it provides.

Testifying at the hearing were: Kimberly Wise, Senior Director, Chemical Products and Technology, American Chemistry Council; Lisa Daniels, P Past-President, Association of State Drinking Water Administrators and Director, Bureau of Safe Drinking Water, Pennsylvania Department of Environmental Protection; Scott Faber, Senior Vice President, Government Affairs, Environmental Working Group; and, Tracy Mehan III, Executive Director, Government Affairs, American Water Works Association.

Energy and Commerce Committee Examines LIFT America Act

This week, the House Committee on Energy and Commerce held a hearing to examine the LIFT America Act (H.R. 2741) that was introduced by Chairman Frank Pallone (D-NJ), along with support from committee Democrats.  H.R. 2741 focuses on rebuilding and modernizing the nation’s energy and water infrastructure systems.  During his opening remarks, Ranking Member Greg Walden (R-OR) emphasized the importance of addressing the needs facing America’s energy and water infrastructure by modernizing the systems.  While he questioned how Democrats plan to pay for the bill’s investments and programs, Walden stated his interest in working with committee Democrats on the legislation.

During the hearing’s discussion, Members were interested in how to improve the nation’s water infrastructure.  Representative Jerry McNerney (D-CA) highlighted his bill, the Smart Energy and Water Efficiency Act of 2019 (H.R. 2665), that is included in the LIFT America Act.  McNerney asked Brian Wahler, Mayor of the Piscataway Township, NJ, to explain the importance of grants assistance for wastewater infrastructure.  In his response, Wahler stressed that federal resources can help deliver opportunities to smaller communities to learn how to better plan for and manage long-term infrastructure investments.  Representative Paul Tonko (D-NY), Chairman of the Subcommittee on Environment and Climate Change, asked Wahler how important is it to include water infrastructure in a larger infrastructure package.  Wahler adamantly responded that it is vital and that municipalities need to be able to utilize all available tools in the toolbox.

Testifying at the hearing were: Mignon Clyburn, Principal, MLC Strategies, LLC; John Auerbach, President and CEO, Trust for America’s Health; Jessica Echdish, Legislative Director, BlueGreen Alliance; Brian Wahler, Mayor, Piscataway Township, NJ, on behalf of the U.S. Conference of Mayors; Daniel Lyons, Visiting Fellow, American Enterprise Institute; and Christopher Guith, Acting President, Global Energy Institute, U.S. Chamber of Commerce.

Administration Prepares Draft Plan to Streamline Environmental Permitting

It was reported this week that the Administration will “complete a draft proposal to streamline environmental permitting for large infrastructure projects by next month.”  Associate Director for the National Environmental Policy Act (NEPA) for the Council of Environmental Quality (CEQ) stated that the draft proposal will be sent to the Office of Information and Regulatory Affairs for review by June.  The draft proposal is in response to a 2017 Executive Order (EO), in which the Administration called of environmental permitting reviews and authorizations for major infrastructure projects.  The EO directs that federal reviews take no “more than an average of approximately 2 years,” and establish a One Federal Decision where projects have one designated lead federal agency that is responsible for navigating the federal environmental review and authorization process for the project. The EO directs CEQ to develop the framework for implementing the One Federal Decision.

Former Sen. Inhofe Staffer Joins USEPA Staff

Katherine English is the new Oversight and Legislative Counsel for the U.S. Environmental Protection Agency’s Office of Congressional and Intergovernmental Relations.  Previously, English was an aide to Senator James Inhofe (R-OK) when Inhofe served as Chairman of the Committee on Environment and Public Works.

New Legislation

S. 1613, A bill to amend the Safe Drinking Water Act to update and modernize the reporting requirements for contaminants, including lead, in drinking water, and for other purposes. – Sen. Ed Markey (D-MA)

S. 1604, A bill to amend the Federal Water Pollution Control Act to reauthorize certain programs relating to nonpoint source management, and for other purposes. – Sen. Amy Klobuchar (D-MN)

S. 1602, A bill to amend the United States Energy Storage Competitiveness Act of 2007 to establish a research, development, and demonstration program for grid-scale energy storage systems, and for other purposes. – Sen. Susan Collins (R-ME)

H.R. 2914, To make available necessary disaster assistance for families affected by major disasters, and for other purposes. – Rep. Adriano Espaillat (D-NY)

S. 1570, A bill to provide flexibility to allow greater aquifer recharge, and for other purposes. – Sen. James Risch (R-ID)

S. 1565, A bill to establish a Corps of Engineers Flood Control Civilian Advisory Council, and for other purposes. – Sen. Josh Hawley (R-MO)

H.R. 2871, To provide flexibility to allow greater aquifer recharge, and for other purposes. – Rep. Russ Fulcher (R-ID)

Reports and Regulation

USDOE Releases Schedule for Updating Energy Efficiency Standards – U.S. Department of Energy released its Spring 2019 Regulation Agenda to catch up on reviewing efficiency standards.

USEPA Memo on Rulemaking Process for Benefits and Costs Analysis in Regulatory Decision-Making – U.S. Environmental Protection Agency Administrator, Andrew Wheeler, published a memorandum initiating the agency’s efforts to provide greater clarity and fairness to the cost-benefit analysis of regulatory decision-making through rectifying statute-specific actions.

Congress Next Week

Congress is on recess next week.