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Why the Country Needs Federal Funding for Water Infrastructure
Fact Sheet • April 2009
ur nation’s water infrastructure and economy are bound together. Aiding the former will help the latter. Unfortunately, these days, both are treading troubled waters.
In communities across the country, drinking water and sewerage systems are straining under the weight of decades of federal government underinvestment. In recent years, the State Revolving Funds were financed at some of the lowest levels in history. For fiscal year 2008, the federal government provided only $1.5 billion, a mere 5.1 percent of the $29 billion that our water and sewer systems need every year.1 As the troubles with our water infrastructure mount, the country’s economy slides deeper into recession. In February 2009 the unemployment rate reached 8.1 percent, or about 12.5 million people, up from 4.8 percent a year earlier. Nearly one in 12 people in the labor force is now unemployed.2 Investing now in water and sewer systems to generate solid economic growth can lead the state out of the recession. Every federal dollar invested in infrastructure yields a $1.59 return to our states.3 The National Utility Contractors Association estimates that for every $1 billion spent on water infrastructure, nearly 27,000 jobs are created.4 The economic stimulus legislation passed by Congress in February 2009 provides more money to water infrastructure than the country has seen in recent years, but this one-time allotment cannot cure the problems plaguing many communities. In fact, the bill provides water and sewer systems with less than one-third of what the Environmental Protection Agency estimates we should spend each year just to maintain them. Water Infrastructure Funding Gap: Our country’s water needs outpace our current ability to fund projects by a large margin. According to EPA’s latest drinking water infrastructure needs assessment, public water systems need an average of $17.4 billion every year to keep our water safe.5 In
2008 the Drinking Water State Revolving Fund Program (SRF) received only $0.8 billion in federal funding6 — enough to finance 4.7 percent of the needs. Federal contributions to drinking water funding efforts have decreased by 35.1 percent since the Drinking Water SRF was implemented in fiscal 1997 and by 51.7 percent when adjusted for inflation.7 According to EPA’s latest clean watersheds needs assessment, publicly owned wastewater systems need an average of $11.5 billion every year to protect water quality and public health.8 In 2008 the Clean Water State Revolving Fund program, which goes toward wastewater infra-
systems. It also should ensure that funds be made available for research and implementation of green infrastructure and conservation practices. National Infrastructure Bank: Related to the trust fund is a proposed national infrastructure bank to raise and distribute the money necessary to upgrade drinking water and wastewater systems, highways and other underpinnings of our nation’s prosperity. Policymakers should strictly limit private sector involvement in water infrastructure to financing only. The public should maintain ownership and control of public water and sewer utilities because it does a far better job of management and operation. Endnotes
1 2008 dollars. United States Environmental Protection Agency, Office of Water. “Tentative distribution of Drinking Water State Revolving Fund appropriation for fiscal year 2008.” May 19, 2008; United States Environmental Protection Agency, Office of Water. “FY 2008 Clean Water State Revolving Fund Title VI Allotments.” January 28, 2008; United States Environmental Protection Agency, Office of Water. “Drinking Water Infrastructure Needs Survey and Assessment Fourth Report to Congress.” (EPA 816-R-05-001). February 2009 at i; United States Environmental Protection Agency, Office of Water. “Clean Watersheds Needs Survey 2004 Report to Congress.” January 2008 at ix; Sahr, Robert C. “Inflation conversion factors for years 1774 to estimated 2019.” Oregon State University, Political Science Department. January 16, 2009. United States Department of Labor, Bureau of Labor Statistics. [Press Release]. “The employment situation: February 2009.” March 6, 2009 at Table A-1. Schwartz, Bernard L. and Schwenninger, Sherle R. “A Public Infrastructure–-Led Economic Recovery Program.” December 4, 2008; Zandi, Mark. Chief economist and co-founder, Moody’s Economy.com. Testimony on Economic Stimulus For Small Business: A Look Back and Assessing Need For Additional Relief. U.S. House Committee on Small Business. July 24, 2008. National Utility Contractors Association. [Press Release]. “New CWC Report Demonstrates Immediate Economic Impact of Water/Wastewater Infrastructure Investment?” January 28, 2009. 2008 dollars. United States Environmental Protection Agency, February 2009 at I; Sahr, 2009. United States Environmental Protection Agency, May 19, 2008. Ibid; United States Environmental Protection Agency, Office of Water. “Distribution of DWSRF funds.” June 23, 2006; Sahr, 2009. 2008 dollars. United States Environmental Protection Agency, January 2008 at ix; Sahr, 2009. United States Environmental Protection Agency, January 28, 2008. Ibid; United States Environmental Protection Agency, Office of Water. “Clean Water State Revolving Fund Allotments.” April 4, 2007; Sahr, 2009. United States Environmental Protection Agency, Office of Water. “National Water Quality Inventory: Report to Congress 2004 Reporting Cycle.” (EPA 841-R-08-001). January 2009 at 1-2. Dorfman, Mark and Kristen Sinclair Rosselot. National Resources Defense Council “Testing the Waters 2008: A Guide to Water Quality at Vacation Beaches.” National Resources Defense Council. 2008 at iv.
structure, received only $0.7 billion in federal funding9 — enough to finance 5.8 percent of the needs. Federal contributions to wastewater funding efforts have decreased by 66.9 percent since the Clean Water SRF was fully implemented in fiscal 1991 and 79.1 percent when adjusted for inflation.10 Job Creation: Fully addressing the nation’s annual water needs of $29 billion would spur 771,487 employment opportunities, according to National Utility Contractors Association estimates for job creation from water infrastructure investments. That could put back to work nearly one of every 16 unemployed people in the nation. Water Quality: According to EPA’s 2004 National Water Quality Inventory assessments, 44 percent of the nation’s river miles, 64 percent of its lake waters and 30 percent of its bays and estuaries are impaired and too polluted to support their designated uses.11 Beach Closings: A report by the Natural Resources Defense Council shows that the number of closings or advisories at beaches and bays in the country topped 20,000 in 2007. This number is more than triple its 2006 level. Aging and poorly designed sewage and stormwater systems cause many beach closures.12 Legislative Solutions: A comprehensive, long-term solution is a dedicated source of public funding for water infrastructure. This would help communities across America keep their water clean, safe and affordable. It would unburden overtaxed state and municipal governments of the cost of water infrastructure repairs. Such an investment also would create employment opportunities and give our economy a much-needed boost. Two legislative solutions exist. Clean Water Trust Fund: A federal water infrastructure trust fund bill will be introduced during the current legislative session. As with the trust fund for highways and airports, we should have a Clean Water Trust Fund to provide municipalities with the funding they need to keep our water safe and clean for future generations. The trust fund should distribute money to publicly owned water and wastewater
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