(July 30, 2020) – The U.S. House last week passed its first Fiscal Year 2021 (FY21) omnibus appropriations package, H.R. 7608, that includes funding for EPA and unprecedented increased levels of federal investment in clean water, including $8.5 billion in funding for the Clean Water State Revolving Fund (CWSRF), which is nearly five times that of current levels.

Due to the addition of a total of $15 billion in emergency infrastructure investments that goes well above the current budget caps in place for FY21, coupled with several controversial policy riders, the package passed along a straight party line vote with Democrat Majority support and is not expected to pass in its current form in the Republican Majority Senate, which is currently in the process of drafting its own FY21 spending package. 

The House appropriations package does, however, demonstrate that Congress is increasingly cognizant of the need for the federal government to provide greater federal resources to communities across the country to help them meet their rapidly growing and evolving clean water infrastructure needs, especially in light of the significant financial impacts that the COVID-19 pandemic is having, and is expected to have, on clean water agencies . 

The omnibus package includes $9.38 billion for EPA, an increase of $318 million over current levels, and provides significant increases to key NACWA priorities and clean water programs including:

• $8.5 billion for the Clean Water State Revolving Fund (CWSRF), which includes the current FY20 level of $1.639 billion and an additional $6.35 billion through EPA emergency infrastructure investment grants (DWSRF was provided with current level of $1.126 billion and an additional $3.8 billion through EPA emergency infrastructure investment grants);
• $457 million for Sewer Overflow and Stormwater Control Grants, which includes nearly $57 million in base funding, nearly $30 million more than the current FY20 level, and an additional $400 million through EPA emergency infrastructure investment grants; and
• $3 million for Water Infrastructure Workforce Development grants, up $2 million over the current FY20 level.

One alarming issue with the bill, however, is that it provides no new direct FY21 appropriations for WIFIA, and as drafted would rescind outstanding unobligated WIFIA appropriations from FY17-FY19 and use that funding to support new loans in FY21, hampering communities that have been following the WIFIA application process in good faith. 

Upon the bills release, House Majority appropriators indicated that the adoption of this new approach stems from their frustration over EPA and the Office of Management and Budget’s (OMB’s) lack of progress in providing required timely WIFIA guidance and reporting on budgetary screening criteria as it relates to federal projects that receive WIFIA funding, as well as their desire to ensure no federally owned projects further obtain or benefit from WIFIA financing.

As a result, the water sector expressed our strong concerns with the recission approach to Congress, and thanks to the advocacy of several of our members, were ultimately successful in helping secure passage of an amendment offered by Rep. Jackie Speier (D-CA) to the final House package that emphasizes that communities currently pursuing a WIFIA loan are not required to restart the application process and therefore able to receive the financing they need.

Given the historic bipartisan support for WIFIA and the several positive subsequent discussions NACWA has had with both House and Senate, appropriators and authorizers, NACWA is optimistic that this political gamesmanship will subside and this harmful approach will be resolved as the FY21 budget process advances.

However, this amendment, and the strong attention it has garnered, provides an important message to appropriators and Congress that as the FY21 appropriations process moves forward, this WIFIA problem needs to be fixed and ensure dozens of communities across the country can proceed with their current WIFIA loan application process for critical water infrastructure projects.

NACWA and the water sector appreciate Rep. Speier’s leadership on this issue and will continue to work with Congress to ensure this issue is fixed and full FY21 WIFIA funding is appropriated. 

NACWA would also like to extend its appreciation to Reps. Gibbs R-OH) and Napolitano (D-CA) for submitting an amendment to the appropriations package that would provide new direct funding for EPA’s ongoing Integrated Planning (IP) activities. While unfortunately the amendment was not accepted by the House Rules Committee, the bill does include report language under EPA’s Environmental Programs and Management account directing funding for IP activities, as was included in last year’s final passed FY20 omnibus.

With the Senate not expected to release its appropriation package for EPA untill September, at this point the expectation in Congress is that a continuing resolution (CR) will be needed to temporarily fund the federal government at current levels to start the fiscal year on October 1^st through some time after the November election.

In the meantime, NACWA will continue working with appropriators and key members of Congress to ensure strong federal funding for clean water and that the WIFIA program remains intact. The Association encourages all of its members to do the same. Please contact Kristina Surfus or Jason Isakovic on NACWA’s legislative team to discuss further.