After nearly two months of ongoing bipartisan infrastructure negotiations between the White House and a group of 22 Senators (G22) led by Senators Portman (R-OH) and Sinema (D-AZ), the Senate on Tuesday passed the first major comprehensive infrastructure package in decades - the Infrastructure Investment and Jobs Act - with true bipartisan support on a vote of 69-30. 

NACWA has worked closely with the Senate Environment and Public Works (EPW) Committee and key members of the G22 in a bipartisan manner throughout this process to ensure the highest level of direct investment - particularly grants - be provided for clean water infrastructure.

This infrastructure bill passed by the Senate is not perfect, nor are the spending levels for water as high as initially proposed. However, it does reflect that the strong advocacy of NACWA and its members were loudly heard by Congress, especially over the past month, as the final bill provides much higher levels of direct investment and grants dollars than expected even as recently as two weeks ago. 

Overall, the roughly $1 trillion legislative package contains $550 billion in new spending, of which $55 billion will go toward clean and drinking water. Specifically, the bill’s main provisions for the water sector include:

• $11.713 billion in direct mandatory appropriations (i.e. not authorizations or mere promises of money) over the next five years for both the Clean Water State Revolving Fund (CWSRF) and the Drinking Water State Revolving Fund (DWSRF) each for a total of $23.5 billion in new federal investment, of which 49% is required to be provided to communities in the form of 100 percent forgiveness of principal or grants. These SRF increases would be on top of annual additional baseline spending (currently $1.639 billion) for the CWSRF that comes through the annual appropriations process.

• An additional $1 billion through the CWSRF and $4 billion through the DWSRF, all in the form of grants, to address emerging contaminants including PFAS, and another $15 billion through the DWSRF to address lead in drinking water.

The bill also includes the key clean water provisions that NACWA and the sector worked to secure through the Senate Drinking Water and Wastewater Infrastructure Act (DWWIA) package, S.914, which passed the Senate in April. These provisions authorize and reauthorize billions of dollars in new federal investment for clean water programs including the CWSRF, sewer overflow and stormwater grants, workforce grants, and climate resiliency.  The legislation additionally establishes a new U.S. EPA low-income water customer assistance pilot program.

The bill now heads to the House of Representatives for consideration, where despite frustrations among many House members with how the bill was drafted and certain aspects of the bill itself, it is expected to ultimately pass and then be signed into law by President Biden. 

The timing of House consideration, however, is still very up in the air as Speaker Pelosi has indicated she will wait to bring the bill up for a vote until the Senate has put forth and passed a separate legislative package related to climate change and investment in social benefits through the budget reconciliation process (more on this below), which is not expected to occur until sometime in September.  There is a small but unlikely chance the House could take up the infrastructure bill the week of August 23^rd.

It is important to note, as explained above, that the funds included in this infrastructure bill (once it is passed by the House and signed by the President) will not be released in one lump sum.  Instead, they will be distributed over a period of five years via existing state SRF programs.  So, it will still be a little while before utilities start to see the funds directly, and there is still more work that NACWA and its members will need to do to make sure states distribute the funds as quickly as possible when they receive them.

Moments after the infrastructure bill passed the Senate, the focus immediately shifted to the partisan passage of the Senate’s $3.5 trillion FY 2022 budget resolution. This unique legislative vehicle includes reconciliation instructions/specific budgetary allocations for each committee and the mechanism for allowing the process to advance under a 51-majority vote threshold, as opposed to 60. 

The budget resolution approved this week is merely a legislative blueprint and a budgetary gimmick to kick start the reconciliation process, during which congressional committees will begin working to craft subsequent legislation related to President Bidens next facet of his Build Back Better Plan. The expectation is that the focus will be on family investment, social and environmental justice, and combating climate change.  

The House is set to come back to Washington for a rare August legislative session the week of the 23^rd to pass the budget resolution/reconciliation measure and then kick start its process to join the Senate committees in working to produce subsequent legislative text that provides investments in the focus areas of the reconciliation bill.  Democrat Leadership has set a goal of producing legislative text by mid-September, however that timeline is very fluid.

Shortly after Senate passage of the budget resolution, NACWA and the Association of Metropolitan Water Agencies (AMWA) sent up a joint letter to Leader Schumer and Speaker Pelosi urging a strong focus on water resilience and affordability through the budget reconciliation process. NACWA has already begun working with Congress and the respective committees drafting the reconciliation text to ensure that these water priorities are included.

NACWA will continue to keep members updated as both the infrastructure bill advances through House and the reconciliation process further unfolds.  Contact Kristina Surfus, NACWA Managing Director of Government Affairs, or Jason Isakovic, NACWA Legislative Director, with any questions.