Funding Flow

July 11, 2014

About the author: Neda Simeonova is editorial director of Water & Wastes Digest. Simeonova can be reached at [email protected] or 847.391.1011.

In June, President Obama signed into law the Water Resources and Reform Development Act of 2014 (WRRDA)—the first water bill since 2007. WRRDA authorizes funding for more than $12 billion worth of new water infrastructure projects.

WRRDA establishes a five-year pilot program—the Water Infrastructure Finance and Innovation Act (WIFIA)—which is modeled after the Transportation Infrastructure Finance and Innovation Act and provides low-interest federal loans and loan guarantees for major water infrastructure projects. 

It also creates the Water Infrastructure Public-Private Partnership (P3) Program for the Army Corps of Engineers, a 15-project pilot program that could lead to increased financing of critical water infrastructure projects through the use of P3s. These projects include coastal harbor improvement, channel improvement, inland navigation, flood damage reduction, aquatic ecosystem restoration, and hurricane and storm damage reduction. While P3s may not be the answer to all water infrastructure projects, the increasing number of P3 projects around the U.S. suggests that the model plays an important role in addressing critical infrastructure needs at times when state and federal funding has diminished. 

According to Ballard Spahr LLP, a national law firm, projects qualifying for the P3 program will benefit from potential waiver from or modification of applicable federal regulations, as well as technical assistance from the Army Corps of Engineers.

Though subject to final appropriation, WRRDA’s 10-year, $12.3-billion spending plan authorizes funding for projects ranging from port improvements in Los Angeles, New Orleans and Boston, to ecosystem enhancement in the Chesapeake Bay, Florida Everglades and Columbia River, and also is expected to propel various upgrades, capital improvements and new facilities. According to Ballard Spahr, implementation may begin as early as this fall.

Some of the language in the WRRDA continues to elevate concerns among water solution providers that oppose the American Iron and Steel language placed on both the Clean Water State Revolving Loan Fund and WIFIA legislation. 

In June, in a letter to the Chairs and Ranking Members of the U.S. Senate Environment and Public Works Committee and the House Transportation and Infrastructure Committee, WWEMA Executive Director Vanessa Leiby expressed the association’s opposition to WRRDA’s “Buy American” restrictions: “This language creates a monopoly for a select few companies; restricts fair and open competition among U.S. manufacturers; creates regulatory burdens on municipalities, states and industry; restricts market growth; impedes technology advancement; and puts many U.S. companies at risk of going out of business.”

We have yet to see how these concerns will be addressed. The bottom line is that WRRDA may not offer the full solution necessary to bridge the wide funding gap of our country’s water infrastructure; however, it certainly is a significant step in the right direction for maintaining critical infrastructure. It will lead to more water infrastructure projects, promote new jobs and economic growth, and, hopefully, kick-start a much-needed funding flow.

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About the Author

Neda Simeonova

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