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Last week, House Republican appropriators fired their opening salvo in the long process of developing EPA’s budget for FY24, proposing to cut the agency’s funding by 39 percent next year while slashing new appropriations for the State Revolving Fund (SRF) programs. Despite the overall cuts the proposal would maintain level funding for several other water infrastructure priorities, and would distribute hundreds of millions of dollars in earmarks to selected water infrastructure projects across the country.

According to the Republicans’ summary of the bill, EPA’s budget would be reduced to $6.173 billion (a 39 percent cut) next year, while its State and Tribal Assistance Grant account would be reduced by 42 percent to $2.584 billion. As a result, regular funding for the Drinking Water and Clean Water SRFs would fall to $460.6 million and $535 million, respectively, with nearly 90 percent of the total being directed to congressionally selected earmarks. House appropriators are expected to unveil their list of proposed water infrastructure earmarks this week.

While the legislation proposes jarring spending cuts for the SRF programs, the figures do not factor in more than $4.8 billion that the SRFs are slated to receive separately in FY24 through the Bipartisan Infrastructure Law. So even in the unlikely scenario that the House proposal was enacted as proposed, the DWSRF would still be in line for nearly $3 billion next year.

Notably, the Republican spending proposal would continue funding for several other AMWA-supported water infrastructure financial assistance programs. These include:

  • $66 million for the Water Infrastructure and Finance and Innovation Act (WIFIA), which could be leveraged into up to $12.5 billion in low-cost water infrastructure loans;
  • $25 million for Reducing Lead in Drinking Water Grants;
  • $30.5 million for lead testing and reduction in school and childcare centers;
  • $5 million for the Midsize and Large Drinking Water System Infrastructure Resilience and Sustainability Program; and
  • $2 million for water workforce investment grants.

Each of these programs would receive level appropriations compared with FY23, except for WIFIA (cut by $2 million) and water workforce investment grants (cut by $4 million).

The full House Appropriations Committee is scheduled to vote on the legislation this week, but a long road remains before any EPA spending bill is finalized. Senate Democratic appropriators will put forward their own proposal that will likely be much friendlier to EPA, and the final package of FY24 spending legislation will almost certainly represent a compromise between these competing perspectives.