By Maureen Lorenzetti
Congressional and industry sources predicted the White House will scale back federal funding for municipal water projects and other domestic items in light of expected budget deficits driven by the weak economy and more spending for homeland security and other anti-terrorism efforts.
Various government agencies have been asked to start preparing budget requests for the 2003 fiscal year that starts this Oct. 1. Congress will begin the appropriations process this spring.
President George W. Bush is expected to propose a federal budget in February that will expand defense spending by $20 billion over last year's $345 billion level. Homeland security measures are expected to be another $15 billion. Slashing domestic spending may mean an even more acrimonious debate over the federal budget than last year, congressional sources said. However, neither Republicans nor Democrats expect anything as dramatic as a government shutdown given that this is an election year and lawmakers will be anxious to adjourn promptly so they can campaign for the November elections.
Congress Passes Grant MoneyHopes that Congress would earmark billions of dollars in new spending for drinking water projects and other industry-related infrastructure have faded in light of new budget constraints. Nevertheless, before a month-long holiday recess Congress approved a $20 billion anti-terrorist bill that includes up to $90 million in grants to improve security of water systems. Industry says that the Environmental Protection Agency has not yet laid out the guidelines under which local systems can receive funds.
The grant money was a compromise between Congress and the Bush administration: a House version sought $109 million; the White House wanted $34 million. The Association of Metropolitan Water Agencies (AMWA) said it was generally pleased with the grant amount: AMWA estimates that $94 million could pay for assessments of the nation's 750 largest water systems.
Utilities Present Wish List To Senate StaffTen water and wastewater utilities laid out their legislative wish lists at a Jan. 3 meeting with congressional staff from the Senate Environment and Public Works Committee. Companies outlined what they hope to see in possible water infrastructure legislation this year. The group also touched on several industry issues including: local rate structures, the need for grants in addition to the existing safe drinking water and clean water revolving loan funds, SRF streamlining, and methods for targeting assistance to disadvantaged communities.
The committee plans to draft legislation and hold February hearings. It remains uncertain whether the bill will include grant language; no funding levels have been set yet either.
Administration ActionA controversial regulation that would tighten the arsenic standard in drinking water may be reconsidered if the White House Office of Management & Budget has its way.
OMB in December drafted a list of rules it thinks may need to be updated or repealed. Included in the list were eight EPA rules, the arsenic standard among them.
OMB also wants EPA to reconsider proposed changes to the Total Maximum Daily Load program, and effluent guidelines for concentrated feed operations.
It also suggested EPA may want to rework its cost-benefit analysis of drinking water regulations. The rules in question were last updated in 1998 and established new treatment and monitoring requirements (primarily related to filtration) for drinking water systems that use surface water as their source and serve more than 10,000 people.
At the time of the final rule, EPA estimated the regulation would cost the water industry total annual costs of $300 million per year: the rule is expected to require treatment changes at about half of the 1,400 large surface water systems, at an annual cost of $190 million. Monitoring requirements add $96 million per year in additional costs, OMB said, with all systems having to perform enhanced monitoring of filter performance. Estimated benefits include mean reductions of from 110,000 to 338,000 cases of cryptosporidiosis annually, with an estimated value of between $500 million to $1.5 billion, with the possible reduction of other waterborne diseases.
The timetable in which EPA will be looking at the drinking water standards and other related rules remains uncertain but some agency officials said it could occur as soon as this spring. WW/
