The House Appropriations Committee on July 31 began consideration of a FY14 Interior, Environment, and Related Agencies appropriations bill that would cut EPA funding by 34 percent while slashing funding for the Drinking Water State Revolving Fund (DWSRF) to a record-low $350 million – more than 60 percent below the program’s enacted FY13 level. But after members offered dozens of amendments during an hours-long markup, the panel postponed a final vote on the measure until after Congress returns to Washington in September.
The steep cuts to EPA and the DWSRF are due in part to efforts by GOP lawmakers to meet the parameters of Budget Committee Chairman Paul Ryan’s (R-Wis.) budget plan, which seeks deficit reductions required under the 2011 Budget Control Act while avoiding some cuts to the Defense Department. Cuts to EPA and other discretionary programs must therefore make up the difference. President Obama and Senate Democrats have favored reaching these deficit targets by including a combination of Defense cuts and new tax increases – though earlier this year the White House also proposed cutting the SRFs by 19 percent.
The Clean Water SRF would suffer an even more severe cut under the House proposal, with its funding reduced by more than 80 percent to just $250 million. The bill would require states to reserve between 20 and 30 percent of their SRF allocations for principal forgiveness, grants, or negative interest loans to low-income communities, and “Buy American” restrictions on the use of foreign iron and steel would apply to all projects funded by SRF dollars. Another section of the legislation would block any use of funds for work on the Obama Administration’s proposed guidance to clarify the scope of federal Clean Water Act jurisdiction.
Interestingly, the GOP-authored committee report accompanying the bill highlighted the proposed “Water Infrastructure Finance and Innovation Act” (WIFIA) as a promising tool that could “complement SRF funds and open more doors to [water infrastructure] investment.” The report language – which has no force of law – went on to suggest EPA should also promote alternative water infrastructure financing mechanisms such as public-private partnerships and private activity bonds to supplement existing federal dollars available through the SRFs.
Appropriations Committee Democrats and Republicans had predictably different interpretations of the measure in the lead-up to the panel’s July 31 markup, with House Appropriations Committee Chairman Hal Rogers (R-Ky.) warning that deep discretionary spending reductions will become more common until Congress reduces the “mandatory spending that is cannibalizing our government.”
Committee Democrats slammed the deep EPA cuts, but an amendment offered by Rep. Debbie Wasserman Schultz (D-Fla.) that would have restored SRF funding to FY13 levels failed along party lines.
AMWA and other water sector organizations weighed in to support adequate funding for the SRFs, sending a letter to all House members warning against allowing “the job of maintaining our critical water and wastewater infrastructure to become a budget casualty.”
After hours of debate over multiple amendments, House Appropriations Committee leaders suspended the panel’s consideration of the bill until September. But with the new fiscal year looming at the end of that month, it is questionable whether the Interior-EPA measure will emerge from committee, let alone receive a vote on the House floor. Instead, FY14 EPA appropriations are likely to be rolled into what could become a massive continuing resolution to keep the government operating beyond that date – though that would first require Democrats and Republicans to reach an agreement on an overall discretionary spending figure.