January 2022, Vol. 249, No. 1


Infrastructure Bill Lavishes $44 Billion in New Money on Water Construction

By Stephen Barlas, Contributing Editor, Washington D.C.

Congress dropped a load of new funding for drinking water and sewer construction in the IIJA, which is meant to be over and above what the appropriations committees will provide annually for the Clean Water and Drinking Water State Revolving Funds (SRF), which typically get between $1 billion and $2 billion a year.   

The infusion of an additional $44 billion over five years, starting in this current fiscal year (FY) 2022, is spread over a bunch of new programs but also includes $11.7 billion over five years for both SRFs. It is split up this way: $1.902 billion in FY22, $2.202 billion in FY23, $2.403 billion in FY24, and $2.603 billion in FY25 The first two years (FY22 and FY23) have a reduced state match of 10%. The match reverts to 20% for FY24-26. The other main concession is that states are required to spend at least 49% of these funds in the form of grants or 100% principal forgiveness – a much higher share than usual not needing to be repaid.   

“Congress included a provision in the bill underscoring that their intention is for these to be supplemental – they still intend to provide annual funding each year to the SRFs on top of IIJA” explained Kristina Surfus, managing director, Government Affairs at National Association of Clean Water Agencies (NACWA). “NACWA will continue advocating for annual spending bills to provide robust funding for the SRFs each year.”  

In addition to that $23.4 billion for SRFs, the bill distributes another $10 billion over five years to address emerging contaminants like per- and poly-fluoroalkyl substances (PFAS), a family of man-made chemicals found in many consumer products, which the Environmental Protection Agency says can negatively impact human health and the environment. That $10 billion is divided into three separate pots:   

  • $4 billion to address emerging contaminants in drinking water “with a focus on” PFAS. The funding will be appropriated evenly at $800 million per year from FY22 through FY26. The funds will be provided to states via the DWSRF with no required state match. All these funds must be awarded by states as grants or principal forgiveness loans.  
  • $5 billion to help small and disadvantaged communities address emerging drinking water contaminants. The funding will be appropriated evenly at $1 billion per year from FY22 through FY26 and will be provided to states for projects that address emerging contaminants in communities eligible for assistance under Section 1459A of the Safe Drinking Water Act.  
  • $1 billion to help wastewater systems address emerging contaminants. The first $100 million will be appropriated in FY22, and an additional $225 million per year will be made available for FY23-FY26. Funds will be distributed through the Clean Water SRF and will not be subject to state matching requirements.  

Lastly, IIJA contains $15 billion to replace all service lines covered by the EPA’s Revised Lead and Copper Rule. That rule refers to lead lines and galvanized pipe downstream from a lead pipe.   

“Our own study showed that it will cost the nation a minimum of $60 billion to replace all service lines covered by the Revised Lead and Copper Rule,” said Tommy Holmes, legislative director, American Water Works Association. “However, if $70 billion were to fall from the sky tomorrow, it would still take a considerable amount of time to replace all of the nation’s more than 6 million lead service lines.”  

He added that while the $15 billion is very much appreciated, the public will need to understand  that more money and time will be needed to replace all of the country’s lead lines.  

“This is a great start, but not the end,” Holmes said.  

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