Government Relations

Senators Offer a Bill to Create a National Infrastructure Bank

Senators Chris Dodd (D-Conn.), chairman of the Senate Committee on Banking, Housing and Urban Affairs, and Chuck Hagel (R-Neb.) introduced a measure intended to revitalize, repair and replace aging roads, bridges, transit systems and water treatment facilities. The legislation establishes a new method through which the federal government can finance infrastructure projects with public and private capital.

As an independent entity of the government, the bank would be tasked with evaluating and financing capacity-building infrastructure projects of substantial regional and national significance.

Modeled after the Federal Deposit Insurance Corporation, the bank would be led by a five-member Board of Directors, each of whom would be appointed by the president and confirmed by the Senate.

Infrastructure projects with a potential federal investment of at least $75 million would be brought to the bank’s attention by a project sponsor. Then, to determine an exact level of federal investment, the bank would use a sliding scale method using several different factors for judgment. Once a level of investment is determined for a project, the bank develops a financing package with full faith and credit from the government. The financing package could include direct subsidies; direct loan guarantees; long-term tax-credit general purpose bonds, and long-term, tax-credit infrastructure project-specific bonds. The initial ceiling to issue bonds would be $60 billion.

According to its sponsors, the goal of the bank is not to displace existing formula grants and earmarks for infrastructure. Rather, it would target large capacity-building projects that are not adequately served by current financing mechanisms.

CBO Reports that U.S. Spending for Roads, Bridges, Waterworks is “Growing Steadily”

A report was issued by the CBO this week on “Trends in Public Spending on Transportation and Water Infrastructure 1956-2004.” The report represents the first CBO analysis on infrastructure spending since 1999. Senators Max Baucus (D-Mont.) and Chuck Grassley (D-Iowa), chairman and ranking member of the Senate Finance Committee, requested the analysis in June.

The report concluded that state and local governments spent most on major projects — nearly $239 billion — while the federal government provided nearly $74 billion, the report said. CBO also found that annual spending on infrastructure rose steadily from the mid-1950s to 2004, growing at an average of 2.3 percent each year. Federal spending on construction and rehabilitation projects remained flat from 2003-2006; operations and maintenance spending increased during the same period.

While private spending on infrastructure projects is minimal, CBO expects it to increase significantly as a growing number of pension funds are pouring cash in such projects, which are seen as relatively safe investments.

More than half of federal capital spending went toward highways and roads in 2006: about $34 billion. Mass transit accounted for $8.4 billion, followed by aviation at $6.2 billion. The federal government spent $3.4 billion on capital water resources needs last year, while water supply and wastewater treatment funding totaled $2.2 billion.

See CBO report: http://www.cbo.gov/ftpdocs/85xx/doc8517/08-08-Infrastructure.pdf

Inhofe Bill Provide $245 Million for Security at Water Treatment Facilities, Vulnerability Assessments

Senator James Inhofe (R-Okla.) introduced legislation on August 2 that would authorize $245 million over several years to fund water-security improvements at drinking water and wastewater facilities. The proposed “Water Security Act” would authorize the EPA to award grants to help water systems assess the vulnerability of their systems to terrorist attacks and natural disasters.

In response to the 9/11 attacks, Congress passed the Bioterrorism Act of 2002, which, among other things, required drinking water utilities to conduct one-time vulnerability assessments and emergency response plans. According to EPA, the vast majority of drinking water utilities that received a mandate under the Bioterrorism Act completed these requirements. Wastewater utilities had not been subject to the Bioterrorism Act.

Other requirements in the bill include the development of state water and wastewater area response networks (WARN) to help with assistance during times of crisis. Additionally, the bill would provide for training of utility personnel, improved assessment procedures and research into water distribution protection.

Energy Bill Passes the House with Advantageous Wording for Tax Credits

The energy bill passed the House on the Saturday before August recess. The bill included a $15.3 billion tax package containing a provision that would make utilities (water, gas and electric) eligible for a 30-percent credit for the use of renewable energy (solar and other).

The Senate’s version of the energy bill, which passed earlier this year, does not contain an energy tax title, so it does not have the renewable energy tax credit language that is in the House bill. The Senate’s tax title failed to clear procedural hurdles in the course of the Senate debate. Senate Democratic leaders have expressed interest in reviving the issue in conference, though is unclear whether they have the votes.

A House-Senate conference awaits on bills that differ dramatically in many ways. Many of the issues that proved highly contentious in both chambers will likely again be the subject of substantial debate and heavy lobbying. Additionally, the House tax package, which is both expensive and controversial, has received veto threats.

Washington Reviews New Ethics and Lobbying Laws

Before the August recess, the Senate approved the much-anticipated and far-reaching package of new ethics and lobbying rules, with an overwhelming majority of Republicans and Democrats agreeing to make the relationship between lawmakers and lobbyists more transparent.

A major change in this bill would shift the liability from congressional offices to lobbyists. Prior to the passage of this law, congressional gift and travel rules only regulated the conduct of congressional Members, offices and employees. Under this new law, a lobbyist or an organization employing a lobbyist is independently liable for violations of the congressional gift and travel rules. In addition, lobbying disclosure reports will now include a sworn certification of compliance with gift and travel rules.

Some of the main provisions in the Lobbying and Gift Reform Bill, which relates to lobbyists, lobbyist employers and entities that retain outside lobbyists, include provisions related to the reporting of bundled contributions, gifts and travel, lobbyist reporting, restrictions on lobbying, political activities/fundraisers and enforcement.

Congress, too, is now subject to new rules intended to make the earmarking process more transparent.

EPA Holds Webcast Training

On Wednesday, September 5, 2007, the EPA will host a Webcast training event on the Incident Command System (IS-100) tailored for the water sector. On Thursday, September 6, 2007, EPA will host a Webcast training event on the National Incident Management System (NIMS IS-700), also tailored for the water sector. The Webcasts will begin at 2:30 p.m. EST on each day and last 2.5 to 3 hours.

Both courses are required for NIMS compliance. These Webcasts will be ideal for water and wastewater utility staff with limited travel budgets who cannot travel to one of EPA's Water Sector ICS and NIMS Training Workshops currently being held in various locations across the United States.

Registration and participation in the Webcasts is free and the instructors will administer the FEMA ICS-100 and IS-700 exams at the end of each respective Webcast. This will allow participants to receive their FEMA certification for these two courses. To register, please go to www.horsleywitten.com/ICStraining and click on the link for dates and locations. On the next page, click on the link for the Alaska and Hawaii Webcasts. You will be redirected to a site where you will register once for both Webcasts.

Dam Repair Measure Approved

The House Transportation and Infrastructure Committee approved a bill that would create a grant program to assist states in repairing unsafe public dams. The bill would authorize $201.2 million through 2012 for the program, which would be administered by the Federal Emergency Management Agency (FEMA).

In light of the high-profile collapse of a bridge in Minneapolis, there is a renewed interest in regular monitoring and repair of the nation’s infrastructure.

Of the 80,000 dams in the United States, 10,000 are considered high risk. Dams that do not meet state safety standards or are a risk to the public would be prioritized under the program.

The grants would be part of the National Dam Safety Program, a federal and state partnership aimed at reducing the risk to life and property from dam failure. The federal government’s share of the cost of repairs would be limited to 65 percent.

NAWC Calls for Appropriators to Provide Funding for the Paul Simon Water for the Poor Act of 2005

In the weeks leading up to the August recess, NAWC wrote to appropriators to reiterate industry support for the Senator Paul Simon Water for the Poor Act. NAWC urged the State and Foreign Operations panels to include strong statutory language for the Water for the Poor Act, which would fund assistance to sustainable and equitable access to safe drinking water and sanitation for the poor at $300 million in fiscal year 2008.

In past years, Congress has provided funding for international water programs; USAID spent almost $400 million on water in 2005. However, most of these monies were allocated towards disaster assistance, which falls outside the scope of the Water for the Poor Act.