EPA’s Office of Ground Water and Drinking Water director urged water utilities to promote best practices in publishing online water quality reports to demonstrate the value of electronic delivery and forestall challenges to the newly approved practice. Members of Congress from both sides of the aisle expressed optimism that the tax exemption for municipal bonds would not be eliminated in upcoming budget bargaining. These and other top-of-mind issues provided an animated exchange between AMWA members and national policymakers at the association’s 2013 Water Policy Conference, held March 17-20 in Washington, D.C.
Mara Liasson , political correspondent for National Public Radio, began the meeting with a look at the current political landscape in the Nation’s Capital. She predicted that the return of Congress to the regular order of budgeting and reconciliation would move the country away from the series of financial crises that have driven the federal government in recent years. Her remarks covered the danger of presidential overreach following reelection, the President’s “charm offensive” and Republicans “plotting a path out of the wilderness.” Liasson views budgets introduced by both parties as opening bids in negotiation and weighed the prospects of a “grand bargain.” Her reading on climate change suggests a big presidential speech and approval of the Keystone Pipeline, but no movement in other areas, such as cap-and-trade. On municipal bond tax exemption, she sees a cap on deductions as more likely than total elimination.
EPA Acting Administrator Bob Perciasepe provided the keynote address and described the agency’s policy priorities. In the face of what he characterized as a “new normal” in financing public works and water resources, he said EPA is at work on the latest infrastructure needs survey. The most recent congressional spending bills, however, provide State Revolving Fund cuts beyond those included in sequestration. While he described the level of uncertainty as “unprecedented,” Perciasepe said the challenges also bring huge opportunities for the agency to think and move differently. He cited more innovative paths to regulation, more sustainable approaches in the Source Water Collaborative and greater information sharing and advanced technology for improved cybersecurity. EPA is looking at ways to involve drinking water utilities in integrated planning and green infrastructure initiatives being pursued with clean water agencies, he said.
The conference introduced many water executives to EPA’s new Director of the Office of Ground Water and Drinking Water Peter Grevatt , who provided a valuable review of the agency’s regulatory agenda for the coming year. Now in the implementation stage are the interpretive memorandum on electronic delivery of Consumer Confidence Reports (CCRs) and the Revised Total Coliform Rule – both of which reflected unprecedented outreach to stakeholders to help ensure the best technologies and less onerous paths to the desired results. With regard to the CCRs, Grevatt urged AMWA members to use best practices to ensure public access to drinking water quality information.
Grevatt also announced that EPA would temporarily step back from revising the 1989 rule for lead and copper in drinking water and seek additional stakeholder feedback on the issues involved. While the rule will still be a priority action in 2013, he did not say when a rule might be proposed. He did say he expects guidance on the definition of “lead-free” to be issued this year. Recommendations on perchlorate from EPA’s Science Advisory Board, expected by the end of March, will drive the schedule for perchlorate regulation, he added.
Two top security policy leaders – Chuck Donnell , Special Assistant to the President and White House Senior Director for Resilience Policy, and Caitlin Durkovich , Assistant Secretary for Infrastructure Protection at the U.S. Department of Homeland Security (DHS) – addressed two key aspects of water system security. Donnell focused on cybersecurity and the elevated importance of this threat, which is being addressed through Executive Order 13636 and Presidential Policy Directive 21, both issued in February. The directives task federal agencies to promote better cybersecurity in critical infrastructure sectors, including the water sector. An integrated task force led by DHS is working to implement the directives, which address security standards, increased federal sharing of threat information with owners and operators and a “whole-of-nation” approach for greater resilience.
Durkovich said DHS has taken notice of the possible implications of aging and failing infrastructure on community resiliency, particularly in the face of natural hazards exacerbated by climate change. She highlighted the use of DHS Regional Resilience Assessments as a way to evaluate interdependencies and cascading effects from incidents, spur creative thinking and inform local decision making on resiliency efforts.
“Get to know your local emergency manager,” was the key recommendation of FEMA Deputy Administrator Richard Serino , who addressed the conference on disaster recovery. He pointed out that his agency is never in charge in crises, but is present to support local governments in whole-of-community, survivor-centric teams that include the private sector, voluntary agencies, the faith-based community, DHS and even academia.
With Super Storm Sandy, the agency introduced a FEMA innovation team to help survivors. Desiree Matel-Anderson , FEMA Chief Innovation Advisor and Think Tank Strategic Vision Coordinator, described how the team allowed FEMA to innovate on the spot and respond in ways it had never done before. The FEMA Think Tank has national conference calls each month during which citizens from across the country can talk with top administrators about new ideas, she said. The approach is allowing FEMA to redesign its disaster recovery center and conduct “fail fairs” to learn from failures.
The National Climate Assessment (NCA), which has been released in draft form for public comment, goes beyond a reporting of vulnerabilities, according to Kathy Jacobs , NCA Director and Assistant Director, Climate Assessment and Adaption, in the White House Office of Science and Technology Policy. An important vision component involves a sustained process to harvest research, build tools to help understand the future on a scientific basis, work at adaptation and mitigation, and community-build with scientists and community decision makers. Water is one of 13 sections in the NCA, which covers not only documentation of water cycle impacts, but also convergence with other sections. New tools include regional climatologies and projections, as well as sea level rise scenarios for the U.S., Jacobs said. Challenges include a new paradigm of nonstationarity, cascading effects and cross-system issues, incorporating ecosystem-based approaches (like green infrastructure) into engineered systems, and knowing “what to adapt to,” especially when this is outside the envelope of prior experience.
Bond Dealers of America Senior Vice President for Government Relations, Susan Collet , described the work of Municipal Bonds for America, a coalition working to maintain tax-exempt bonds for community infrastructure investments. She voiced concern that the municipal bond tax exemption could be threatened by tax reform and Congress’ current penchant for making “policy in a blender.” Collet described the need to educate lawmakers that tax-exempt bonds do not only generate tax benefits for wealthy investors, but also deliver lower interest rates to communities funding infrastructure investments and creating local jobs. She applauded a recent bipartisan resolution introduced in the House by Reps. Lee Terry (R-Neb.) and Richard Neal (D-Mass.) commemorating the 100-year anniversary of the federal tax exemption for municipal bonds and recognizing the important contribution of municipal bonds to economic growth and wellbeing throughout the nation.
AMWA General Counsel Robert Saner of Powers Pyles Sutter & Verville discussed EPA’s Water Transfers Rule (WTR) and cases against utilities regarding the conveyance of raw water from one water body to another. In 2010, the 11th Circuit Court of Appeals, in deference to the WTR, decided an NPDES permit was not required by the South Florida Water Management District to move water between canals. More recently, the 9th Circuit Court of Appeals ruled likewise in a case involving Los Angeles County. Saner expects the Federal District Court for New York’s Southern District will eventually rule on the merits of WTR. The decision will likely go the 2nd Circuit on appeal and possibly to the Supreme Court after that.
Sen. Jeff Merkley (D-Ore.), member of the Senate Environment and Public Works Committee, led a series of legislators to address the conference. He noted that while China spends ten percent of its gross domestic product on infrastructure and Europe spends five percent, the U.S. invests only two percent. He has introduced a Water Infrastructure Financing and Innovation Act (WIFIA), borrowed from the successful transportation model (TIFIA) to add another tool for investment at Treasury rates to provide low-default communities with the lowest rates possible. WIFIA is framed as a pilot program to “get a foot in the door,” he said, and once it is demonstrated as a successful model, the program will grow. He encouraged the audience to envision this as a step-by-step process and prepare to support additional steps toward growth.
Rep. John Shimkus (R-Ill.), chairman of the House Environment and the Economy Subcommittee, spoke of the recently proposed House budget, which would balance in 10 years, and urged conference attendees to talk with their members of Congress about SRF funding and the implications of tax reform for the tax treatment of municipal bonds. He expressed concern that EPA should not micromanage issues like cybersecurity but should provide better cost-benefit analysis and sounder science in regulating contaminants such as perchlorate and hexavalent chromium.
Rep. Tim Bishop (D-N.Y.), ranking member of the House Water Resources and Environment Subcommittee, expressed optimism about the 113th Congress, noting that Transportation and Infrastructure Committee Chairman Bill Shuster (R-Pa.) wants a return to bipartisanship on the committee and has made Water Resources Development Act (WRDA) legislation a priority. Rep. Bishop said he is about to refile his Water Quality Protection and Job Creation Act that provides a toolbox for infrastructure, including increased funds for the SRF, a Clean Water trust fund and WIFIA loans through the SRF program. He acknowledged AMWA’s position supporting WIFIA funding outside the SRFs, but expressed his concern that the approach would undermine the SRF program’s long-term future.
Rep. Grace Napolitano (D-Calif.), ranking member of the House Water and Power Subcommittee, is an advocate for desalination. In February, she introduced H.R. 745, the Reauthorization of the Water Desalination Act of 1996, which would fund federal desalination research and development projects. Desalination is critical for the future of a reliable, sustainable water supply, especially for western states, she told the group. Continued federal funding is needed to enhance technologies for producing new water from the ocean in order to combat drought, population growth and climate change. The bill would allocate $3 million a year through 2018. Rep. Napolitano also expressed delight that Committee Chairman Shuster has been working on both sides of the aisle.
Rep. Michael McCaul (R-Tex.), chairman of the House Homeland Security Committee, provided an overview of the cybersecurity environment and said things were quite alarming. While cyber espionage and criminal theft of intellectual property are disruptive, he is most worried about cyber threats that are destructive. The majority of threat information is in the private sector, he said, and he supports information sharing rather than forced relations between the private sector and government agencies coordinating cybersecurity, such as NSA, DHS and the FBI. He wants to learn how to incentivize and provide safe harbor for information sharing with the private sector and expects more appropriations for cybersecurity because it is a bipartisan issue.
Observing that climate change is “one of the most serious things our nation and planet will face in coming decades,” Rep. Lois Capps (D-Calif.), member of the House Environment and the Economy Subcommittee, discussed H.R. 765, the Water Infrastructure Resiliency and Sustainability Act she introduced in February. Rep. Capps thanked AMWA for its support of the bill, which would help water and wastewater utilities adapt their infrastructure to the impacts of changing hydrological conditions by establishing a competitive program at EPA to offer assistance to utilities undertaking projects to further infrastructure sustainabilitly or to study the potential impacts of changing hydrological conditions on their water systems.
Powerpoint presentations from the conference are available to members online at www.amwa.net/cs/conferences/presentations .