Chair of Signal Water, Mae Stevens discusses recent accomplishments of the water industry and what to expect in water infrastructure policy in 2022.
2021 was a rollercoaster. It began with anticipation of historic levels of infrastructure spending, then excitement and celebration surrounding the passage of the Infrastructure Investment and Jobs Act (IIJA). Now 2022 begins with further anticipation as we await clarity on the future of the Build Back Better Act (BBB).
Focusing first on the triumphant moments: $55 billion for water infrastructure included in the Infrastructure Investment and Jobs Act! This legislation is a special source of pride for us at Signal Group. This funding will have a tremendous impact in communities across the US.
Here is what we accomplished:
State Revolving Funds (SRF):
$11.173B for the Drinking Water SRF
$11.173B for the Clean Water SRF
Lead Service Line (LSL) Replacement:
$15B through the Drinking Water SRF
$4B through the Drinking Water SRF
$1B through the Clean Water SRF
Low-Income Customer Assistance:
Authorization of a low-income water customer assistance needs assessment and pilot program to help our most vulnerable households cover the costs of maintaining access to water services.
So, what should water industry professionals look out for in 2022?
Build Back Better:
The bill on everyone’s mind right now is Build Back Better—President Biden’s plan to enable more Americans to join and remain in the workforce, grow our economy, and meet our climate goals. The bill includes the most transformative investments in children and caregivers in a generation, including universal pre-k, investments in affordable housing and child nutrition, and delivering affordable and high quality care for older Americans. The bill reduces prescription drug costs and insurance costs, and expands Medicare and Medicaid. The bill also makes the largest-ever investment in combating climate pollution and the deadly effects of climate change.
But what does it mean for water?
Build Back Better builds on the water investments of IIJA. Specifically, BBB invests $9B more dollars in lead remediation projects through the EPA and nearly $1B more through the USDA, specifically for disadvantaged rural communities. BBB also invests $1.85 billion for combined sewer and storm sewer overflows–meaning less raw sewage overflowing into our nation’s rivers every time it rains. Additionally, BBB funds the low-income water customer assistance pilot program created in IIJA, which will alleviate the burden of rising water costs on low-income families. This program will also create a positive feedback loop for water utilities, providing them with more revenue to manage and improve their water systems resulting in the ability to provide safer water.
While IIJA makes a far greater direct investment in water infrastructure than BBB, it should also be noted that an investment in climate resiliency is an investment in our nation’s water systems. For example, the more work done to reduce carbon emissions, helping slow the pace of climate change and extreme weather events, the less stress put on our water systems from events such as extreme drought and floods. This ultimately will help water systems continue to supply clean, safe, reliable, and affordable water to homes and businesses across the U.S.
Water Resources Development Act
Congress is expected to advance the 2022 Water Resources Development Act (WRDA), but its scope remains unclear. If Build Back Better passes with all of the expected water infrastructure funding, it is likely that WRDA will focus only on U.S. Army Corps of Engineers activities surrounding coastal resilience and natural infrastructure. If BBB fails, it is possible that the EPA water infrastructure funding included in the bill could be included in WRDA 2022 instead. WRDA bills traditionally enjoy very strong bipartisan support, so this bill is well positioned to pass.
Congress has yet to agree on a FY2022 spending bill, with Trump Administration levels of federal funding extended through February 15. While the House and Senate Appropriations Committees have been hard at work drafting a spending bill, it appears Republicans may be largely unmotivated because the current spending remains at Trump-era levels. Democrats, eager to advance their first spending bill under the Biden Administration, will likely need to engage in significant negotiations to find middle ground acceptable to both parties.
While there is yet to be resolution on a FY2022 spending bill, both Senate and House versions include increased funding for key water programs, including the Clean and Drinking Water State Revolving Funds (SRFs), the Water Infrastructure Finance and Innovation Act (WIFIA), as well as grants for environmental justice, reducing lead in drinking water, sewer overflow and stormwater reuse, and small and disadvantaged communities.
FY 2023 Appropriations:
With FY2022 appropriations currently in limbo, the process is soon to begin again for FY2023. On February 7, the Biden Administration is anticipated to send their FY2023 budget request to Congress. Once Congress receives the budget request, committee hearings and mark-ups will begin in March.
President Biden’s budget request, signaling forthcoming priorities and focus areas, will likely be a source of political debate throughout 2022.
2022 will likely prove no less eventful than 2021, and hopefully filled with even more wins for water through the passage of BBB and additional funding for programs through the annual appropriations processes. Stay tuned!