A proposed $34.7 billion of federal spending through the Drinking Water and Clean Water State Revolving Funds (SRF) will generate $102.7 billion in total economic output and create more than 500,000 U.S. jobs, according to a new economic benefits analysis study by the Water Environment Federation (WEF) and the WateReuse Association. The study was conducted at the request of the Senate Environment and Public Works Committee (EPW) for an April hearing on the federal role in water/wastewater infrastructure funding.
The analysis captured the effect of spending as it ripples through the economy and considered estimated impacts (output, labor income, jobs and federal tax revenue) of SRF-funded projects in four example states. Based on an assumption that the proposed $34.7 billion in allocations ($14.7 billion for drinking water and $20 billion for clean water) would be spent over a ten-year period, the report found:
- $34.7 billion in federal SRF spending results in $7.43 billion in federal tax revenues;
- When leveraged with the state SRF program funds, a $34.7 billion federal investment will result in $32.3 billion in federal tax revenue or $0.93 for every dollar spent;
- On average, 16.5 jobs are created for each million dollars of SRF funding, meaning that a $34.7 billion federal investment will result in 506,000 new jobs; and
- Every million dollars of SRF spending results in $2.95 million in U.S. economic output, meaning that a $34.7 billion federal investment will generate $102.7 billion in total economic output.
The findings were cited by EPW in a Sense of the Senate provision in S. 2848, The Water Resources Development Act of 2016, which calls for robust SRF funding. The Committee passed S. 2848 in April and the bill is expected to be considered by the full Senate this summer.
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Read the report at www.wef.org/wef-wra-srf-economic-impact-study-report-april-29-2016.