Questions Arise On SRF Stimulus Funding

By Stephen Barlas, Washington Editor | June 2009 Vol. 64 No. 6

Questions are beginning to arise from states and localities about the requirements for spending the water infrastructure funds in the stimulus bill, called the American Recovery and Reinvestment Act (ARRA) of 2009.

Since Congress passed the bill in February, the Environmental Protection Agency (EPA) has distributed $1.4 billion of the $4 billion the stimulus bill provided for the Clean Water and Drinking Water State Revolving Funds. States must commit 100 percent of their funds by Feb. 10, 2010.

But some states are uneasy about certain conditions for spending the funds. Chief among the sticky wickets is the “Buy American” provision. It states that construction companies must use U.S. made iron, steel and manufactured goods on all sewer and drinking water projects funded with stimulus dollars. The EPA issued guidance on April 28 spelling out under what conditions states can apply for an exemption from that provision. (EPA Buy America guidance is at: http://www.epa.gov/water/eparecovery/docs/04 29 2009_BA_waiver_process_final.pdf)

Exemptions will be applied for on a large scale, apparently. The day after that guidance was issued, Matthew J. Millea, acting president, New York State Environmental Facilities Corporation, told the House Transportation and Infrastructure Committee that there is “an inherent conflict” in the Buy American provision and the Green Reserve incentive. “While we would prefer to have these monies invested domestically, the reality is that many technological innovations require foreign-made systems and materials,” Millea said. The Green Reserve provision in the stimulus bill requires states to use 20 percent of their total grant for such things, in the sewer area, as energy efficient retrofits and upgrades to pumps and treatment processes, or for green infrastructure which could include restoring natural hydrology by infiltrating, evapotranspiring and capturing and using stormwater. In the context of the DWSRF, green infrastructure consists of site specific practices, such as green roofs and porous pavement at drinking water utility facilities.