Bennet, Pettersen, Bipartisan, Bicameral Colleagues Urge Appropriations Committees to Fund Water Infrastructure Projects

July 17, 2024

Washington, D.C. - Colorado U.S. Senator Michael Bennet and U.S. Representative Brittany Pettersen, alongside U.S. Senator Kevin Cramer (R-N.D.) and U.S. Representative Kelly Armstrong (R-N.D.), led a bipartisan, bicameral letter to the leaders of the Senate and House Appropriations Committees over concerns with the federal financing of our nation's water infrastructure.

"The Clean Water and Drinking Water State Revolving Funds have been critical to expand access to clean water, modernize aging water infrastructure, and safeguard our public health," wrote Bennet, Pettersen, and the lawmakers. "If funding shortfalls and diversions continue, a major lifeline of our federal water infrastructure funding will run dry at a time when costs for infrastructure, design, and planning are skyrocketing."

The Clean Water State Revolving Fund (CWSRF) and the Drinking Water State Revolving Fund (DWSRF) have been the principal financing programs for drinking water, wastewater, and stormwater projects for nearly three decades. However, more than $3.7 billion dollars has been redirected from these projects since 2021. States are now experiencing significant shortfalls in funding for important water infrastructure projects. In the letter, the lawmakers urge the committees to provide a more sustainable funding source for critical water projects.

"Robust funding through the annual appropriations bills are essential for SRF borrowers to maintain their access to financing for critical infrastructure and ensure clean water for years to come." said Keith McLaughlin, Executive Director, Colorado Water Resources and Power Development Authority.

"The Colorado Water Congress has long supported legislation and appropriations processes to fund our nation's clean water and drinking water infrastructure," said Chane Polo, Deputy Director, Colorado Water Congress. "It is our policy to support efforts that maximize the ability of water funding entities, including the Colorado Water Resources and Power Development Authority, to finance water projects. SRFs provide more communities with access to affordable financing for water infrastructure that protects public health needs."

"The changes to the amounts of revolving fund financing available to states have had a direct impact on Cañon City," said Leo Evans, Director, Cañon City Water Public Works. "When we first started working with the state, we were in line for $5M in principal forgiveness through the program paired with a $5M low-interest loan. We went to work and based the next three years of capital planning and budgeting on those figures. When we reached the next stage of the application process, we were informed that the principal forgiveness amounts available to us had been reduced to a maximum of $1M. That change has thrown a lot of our capital planning up in the air and left the city with uncertainty on how best to proceed with our planned improvements. Restoring the program funding back to the original levels envisioned in the Bipartisan Infrastructure Law would help Cañon City ensure that we can bring the benefits of this program to our community."

In addition to Bennet, Pettersen, Cramer, and Armstrong, U.S. Senators Sherrod Brown (D-Ohio), John Hickenlooper (D-Colo.), Peter Welch (D-Vt.), Bernie Sanders (D-Vt.), Tina Smith (D-Minn.), Tammy Baldwin (D-Wis.) and U.S. Representatives Yadira Caraveo (D-Colo.), Diana DeGette (D-Colo.), Joe Neguse (D-Colo.), Jill Tokuda (D-Hawaii), Jason Crow (D-Colo.), Seth Magaziner (D-R.I.), Summer Lee (D-Pa.), and Becca Balint (D-Vt.) also signed this letter.

The letter is also supported by: the Colorado Water Congress, Colorado Rural Water Association, Colorado Water Utility Council (CWUC), Metro Water Recovery, National Governors Association (NGA), American Water Works Association (AWWA), Council of Infrastructure Financing Authorities (CIFA), National Association of Counties (NACo), National Special Districts Coalition (NSDC), Association of State Drinking Water Administrators (ASDWA), Association of Clean Water Administrators (ACWA), Clean Water Action, Water Environment Federation, Water & Wastewater Equipment Manufacturers Association, Western States Water Council, American Rivers, National Water Resources Association, Alliance for Water Efficiency, River Network, National Municipal Stormwater Alliance, National Association of Clean Water Agencies (NACWA), Association of Clean Water Administrators, Green Infrastructure Leadership Exchange, American Public Works Association, Freshwater Future, Environmental Policy Innovation Center (EPIC), Clean Water Construction Coalition, Western Recycled Water Coalition, Natural Resources Defense Council, Distribution Contractors Association.

The text of the letter is available HERE and below:

Dear Chair Murray, Vice Chair Collins, Chair Cole, Ranking Member DeLauro, Chair Merkley, Ranking Member Murkowski, Chair Simpson, and Ranking Member Pingree:

We write concerning current state allocations for the Clean Water and the Drinking Water State Revolving Funds (SRF), which were reduced as a result of redirecting funds to the Community Project Funding and Congressionally Directed Spending (CPF/CDS) process. The CPF/CDS process is part of federal aging water infrastructure financing programs; however, if broader SRF resources continue to be diverted to CPF/CDS, states will experience significant shortfalls in funding water infrastructure projects.

As you develop the Fiscal Year 2025 (FY25) Interior, Environment, and Related Agencies Appropriations bill, we urge the Committee to take two steps. First, increase funding for SRFs to account for CPF/CDS. Second, provide a more sustainable funding source for critical water projects through the CPF/CDS process, particularly one that does not siphon funds from essential projects reliant on SRF financing.

The SRFs have been the principal water financing programs for more than three decades, supporting water infrastructure projects - such as drinking water, wastewater, and stormwater projects - through low-cost loans and limited grants to underserved communities to cities and towns across our nation. These funds have been critical to expand access to clean water, modernize aging water infrastructure, and safeguard our public health. After Congress resumed the CPF/CDS process in the 117th Congress, annual Appropriations Acts reduced funding for state SRFs by more than $3.7 billion in FY22, FY23, and FY24 to fund CPF/CDS.

In FY22 and FY23, 56% of funds for both SRFs in aggregate were diverted to CPF/CDS (not including supplemental appropriations in the Bipartisan Infrastructure Law (BIL)); meaning that during this time, only 44% of SRF funds supported low-cost loans and limited grants for water infrastructure projects. In FY24, Congress provided a total of $2,764,962,000 for the SRFs. Of this amount, 51.3% or $1,419,312,172 was dedicated to CPF/CDS. If funding shortfalls and diversions continue, a major lifeline of our federal water infrastructure funding will run dry at a time when costs for infrastructure, design, and planning are skyrocketing.

Congress made a concerted effort to invest in our aging water infrastructure through the BIL. The law seeded $43 billion for the Clean Water State Revolving Fund and the Drinking Water State Revolving Fund, funding a critical boost for dire repairs. However significant, this historic one-time infusion will eventually run out. SRFs pay dividends for our water infrastructure and are necessary to further BIL investments. For these reasons, we urge the Committee to invest in sustainable funding sources for SRFs.

We are grateful for the Committee's commitment to fund our nation's clean water and drinking water infrastructure through the annual Appropriations process, but we are increasingly concerned about SRFs' solvency in years to come. Through the FY25 Interior, Environment, and Related Agencies Appropriations bill, we urge the Committee to ensure the longevity of SRFs by fully funding the programs and to provide a more sustainable funding source for CPF/CDS.

Thank you for your consideration of this request.

Sincerely,

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