Clean Water Act Issues in the 109th Congress

Order Code IB10142

CRS Issue Brief for Congress

Received through the CRS Web

Clean Water Act Issues

in the 109th Congress

Updated May 24, 2006

Claudia Copeland

Resources, Science, and Industry Division

Congressional Research Service ˜ The Library of Congress

CONTENTS

SUMMARY

MOST RECENT DEVELOPMENTS

BACKGROUND AND ANALYSIS

Introduction

Legislative Activity Since P.L. 100-4

109th Congress

Recovery from Hurricanes

Wastewater Security

Legislative Issues in the 109th Congress

Authorization of Water Infrastructure Funding

Legislative Responses

Other Clean Water Act Issues

Regulatory Protection of Wetlands

TMDLs and State Water Quality Standards

Other Implementation Issues

LEGISLATION

FOR ADDITIONAL READING

CRS Issue Briefs and Reports

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Clean Water Act Issues in the 109th Congress

SUMMARY

Legislative initiatives to comprehensively

amend the Clean Water Act (CWA) have

stalled for some time as interested parties have

debated whether and exactly how to change

the law. Congress has recently focused legislative attention on narrow bills to extend or

modify selected CWA programs, rather than

taking up comprehensive proposals. For example, the 108th Congress enacted one bill

amending the CWA: legislation to reauthorize

the National Estuary Program (H.R. 4731,

P.L. 108-399). In the 109th Congress, Congress passed legislation to extend authorizations for the Long Island Sound Program

(H.R. 3963, P.L. 109-137). The House has

passed H.R. 1721, a bill to reauthorize coastal

water quality programs. Also, the Senate

Environment and Public Works Committee

has approved S. 1400, a bill authorizing $20

billion in federal grants to capitalize state

clean water infrastructure loan programs. A

House committee has approved bills to

reauthorize other Clean Water Act programs:

H.R. 624 would provide $1.5 billion in grants

over six years for sewer overflow projects;

and H.R. 1359 would extend a pilot program

for alternative water source projects.

Following Hurricanes Katrina and Rita,

the Senate has passed legislation to streamline

delivery of funds to repair storm-damaged

sewage treatment plants (S. 1709). Other bills

intended to simplify environmental review of

recovery and rebuilding projects also have

been introduced (S. 1711, S. 1765/S. 1766).

For several years, the most prominent

legislative water quality issue has concerned

financial assistance for municipal wastewater

treatment projects, and it has received attention in the 109th Congress as well. At issue is

how the federal government will assist states

and cities in meeting needs to rebuild, repair,

and upgrade wastewater treatment plants,

especially in light of capital costs that are

projected to be as much as $390 billion over

the next two decades. This issue received

attention in the 108th Congress, as House and

Senate committees reported legislation, but no

further action occurred on either bill.

Several other Clean Water Act issues

could receive congressional attention. Programs that regulate activities in wetlands,

especially CWA Section 404, have been

criticized by landowners for intruding on

private land-use decisions and imposing

excessive economic burdens. Environmentalists view these programs as essential for

maintaining the health of wetland ecosystems.

These groups are concerned about a 2001

Supreme Court decision, the SWANCC case,

that narrowed regulatory protection of wetlands, and related administrative actions,

including 2003 policy guidance intended to

interpret the case. Legislation to reverse the

SWANCC ruling has been introduced in the

109th Congress (H.R. 1356, the Clean Water

Authority Restoration Act), as has a bill to

narrow the government’s regulatory jurisdiction (H.R. 2658, the Federal Wetlands Jurisdiction Act).

Also of interest is whether and how the

Administration will revise the current program

for restoration of pollution-impaired waters

(the Total Maximum Daily Load, or TMDL,

program), in view of continuing controversies.

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MOST RECENT DEVELOPMENTS

Wastewater security issues are again receiving attention in the 109th Congress. On May

23, the Senate Environment and Public Works Committee approved S. 2781, a bill that

encourages wastewater utilities to conduct vulnerability assessments and authorizes $220

million to assist utilities with assessments and preparation of site security plans.

In December 2005, the House and Senate passed legislation to reauthorize funding for

the Long Island Sound Program in the Clean Water Act; President Bush signed it on

December 22 (H.R. 3963, P.L. 109-137). Also in December, the House passed H.R. 1721,

a bill to reauthorize coastal water quality programs in the act. Water infrastructure funding

legislation has been receiving congressional attention because of estimates by the

Environmental Protection Agency that as much as $390 billion will be needed over the next

two decades to rebuild, repair, and upgrade the nation’s wastewater treatment plants. In July

2005, the Senate Environment and Public Works Committee approved S. 1400, a bill

authorizing federal funds for local wastewater and drinking water infrastructure programs,

including $20 billion to capitalize state clean water infrastructure loan programs. In May

2005, the House Transportation and Infrastructure Committee approved bills to reauthorize

two other Clean Water Act programs. H.R. 624 would provide $1.5 billion in grants over

six years for sewer overflow projects (CWA Sec. 221), and H.R. 1359 would extend a pilot

program for alternative water source projects (CWA Sec. 220).

In the Gulf Coast region affected by Hurricanes Katrina and Rita, high winds and water

damaged several hundred sewage treatment plants, along with many other public and private

facilities and structures. Assessment and repair of water infrastructure facilities is underway,

and legislation has been introduced in the 109th Congress that is intended to aid recovery and

rebuilding. One bill intended to streamline delivery of funds to repair storm-damaged

sewage treatment plants (S. 1709) was passed by the Senate on September 27. Other bills

are intended to simplify environmental review of recovery and rebuilding projects (S. 1711,

S. 1765/S. 1766).

BACKGROUND AND ANALYSIS

Introduction

Although much progress has been made in achieving the ambitious goals established

30-plus years ago to restore and maintain the chemical, physical, and biological integrity of

the nation’s waters, problems persist. The types of remaining water quality problems are

diverse, ranging from pollution runoff from farms and ranches, city streets, and other diffuse

or “nonpoint” sources, to metals (especially mercury) and organic and inorganic toxic

substances discharged from factories and sewage treatment plants.

The principal law that deals with polluting activity in the nation’s streams, lakes,

estuaries, and coastal waters is the Federal Water Pollution Control Act (P.L. 92-500, enacted

in 1972), commonly known as the Clean Water Act, or CWA (amended by P.L. 95-217 in

1977, P.L. 97-117 in 1981, and P.L. 100-4 in 1987). It consists of two major parts:

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regulatory provisions that impose progressively more stringent requirements on industries

and cities to abate pollution and meet the statutory goal of zero discharge of pollutants; and

provisions that authorize federal financial assistance for municipal wastewater treatment

plant construction. Both parts are supported by research activities, plus permit and

enforcement provisions. Programs at the federal level are administered by the Environmental

Protection Agency (EPA); state and local governments have major responsibilities to

implement CWA programs through standard-setting, permitting, and enforcement.

The objective declared in the 1972 Act of restoring and maintaining the chemical,

physical, and biological integrity of the nation’s waters was accompanied by statutory goals

to eliminate the discharge of pollutants into navigable waters by 1985 and to attain, wherever

possible, waters deemed “fishable and swimmable” by 1983. While those goals have not

been fully achieved, considerable progress has been made, especially in controlling

conventional pollutants (suspended solids, bacteria, and oxygen-consuming materials)

discharged by industries and municipal sewage treatment plants.

Progress has been mixed in controlling discharges of toxic pollutants (heavy metals,

inorganic and organic chemicals), which are more numerous and can harm human health and

the environment even when present in minute amounts — at the parts-per-billion level.

Moreover, efforts to control pollution from diffuse sources, termed nonpoint source pollution

(rainfall runoff from urban, suburban, and agricultural areas, for example), are more recent,

given the earlier emphasis on “point source” pollution (discharges from industrial and

municipal wastewater treatment plants). Overall, data reported by EPA and states indicate

that 39% of river and stream miles assessed by states and 45% of assessed lake acres do not

meet applicable water quality standards and are impaired for one or more desired uses.

Approximately 95,000 lakes and 544,000 river miles in the United States are under fishconsumption advisories (including 100% of the Great Lakes and their connecting waters),

due to chemical contaminants in lakes, rivers, and coastal waters, and one-third of

shellfishing beds are closed or restricted, due to toxic pollutant contamination. For mercury

— a contaminant of growing concern — as of 2003, 45 states had issued partial or statewide

fish or shellfish consumption advisories.

The most recent major amendments were enacted in 1987 (P.L. 100-4); this was the first

comprehensive revision to the law in a decade. Authorizations for a number of programs,

such as general grant assistance to states, research, and general EPA support authorized in

that law, expired in FY1990 and FY1991. Authorizations for wastewater treatment funding

expired in FY1994. None of these programs has lapsed, however, as Congress has continued

to appropriate funds to implement the act. (For further information, see CRS Issue Brief

IB89102, Water Quality: Implementing the Clean Water Act, by Claudia Copeland.)

The Clean Water Act has been viewed as one of the most successful environmental laws

in terms of achieving its statutory goals, which have been widely supported by the public, but

lately some have questioned whether additional actions to achieve further benefits are worth

the costs. Criticism has come from industry, which has been the long-standing focus of the

act’s regulatory programs and often opposes imposition of new stringent and costly

requirements. Criticism also has come from developers and property rights groups who

contend that federal regulations (particularly the act’s wetlands permit program) are a costly

intrusion on private land-use decisions. States and cities have traditionally supported water

quality programs and federal funding to assist them in carrying out the law, but recently

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many have opposed CWA measures that they fear might impose new unfunded mandates.

Many environmental groups believe that further fine-tuning to strengthen the act is needed

to maintain progress achieved to date and to address remaining water quality problems.

Legislative Activity Since P.L. 100-4

Following enactment of amendments in 1987, no major CWA legislative activity

occurred until the 104th Congress (1995). The House approved a comprehensive

reauthorization bill, H.R. 961, that was opposed by environmentalists and the Clinton

Administration. Critics said that the bill would undermine the existing framework for

protecting U.S. waters. The Senate did not take up H.R. 961 or other CWA legislation.

In the 105th and 106th Congresses, no comprehensive reauthorization legislation was

introduced, but action was taken in the 106th Congress on bills dealing with specific water

quality issues. Congress passed a bill to strengthen protection of coastal recreation waters

through upgraded water quality standards and coastal waters monitoring programs (P.L. 106284). Congress also passed a bill (P.L. 106-457) that reauthorized several existing CWA

programs (i.e., Chesapeake Bay cleanup, clean lakes, and the National Estuary Program), and

a bill to authorize CWA grant funding for wet weather sewerage projects (included as a

provision of the FY2001 Consolidated Appropriations bill, P.L. 106-554).

During its tenure, the Clinton Administration did not offer legislation to reauthorize the

CWA, but rather initiated a number of agency-wide and program-specific reforms focusing

on flexibility and what were termed “common sense” approaches to regulation.

The 107th Congress focused legislative attention on one of the key programs of the act,

provisions concerning financial assistance for municipal wastewater treatment projects.

House and Senate committees approved bills to extend the act’s State Revolving Fund (SRF)

program through FY2007 (H.R. 3930, S. 1961). Neither bill received further action, in large

part due to controversies over application of the Davis-Bacon Act, which requires that

contractors, engaging in certain federal contract construction, pay workers on such projects

not less than the locally prevailing wage for comparable work, and over the formula for

allocating SRF grants among the states.

The single water quality measure enacted by the 107th Congress was the Great Lakes

Legacy Act (P.L. 107-303). It amended existing Great Lakes provisions of the CWA

(Section 118) to authorize $50 million annually for FY2004-FY2008 for EPA to carry out

projects to remediate sediment contamination in the Great Lakes. The bill also reauthorized

CWA provisions concerning the Lake Champlain Basin Program. Miscellaneous provisions

revived a number of CWA reports to Congress that had been discontinued under a previously

passed “sunset” law (P.L. 104-66) and allowed states to use CWA Section 319 grant funds

for stormwater management projects in FY2003.

In the 108th Congress, attention again focused on water infrastructure financing issues,

although no bill was enacted (see below). However, there was some action on bills to

reauthorize existing, mostly geographic-specific programs in the Clean Water Act. Before

recessing for the 2004 election, the House and Senate passed H.R. 4731, to reauthorize the

National Estuary Program through FY2010. The President signed this bill on October 30,

2004 (P.L. 108-399). The National Estuary Program, authorized by the 1987 CWA

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amendments, is directed at improving the quality of estuaries of national importance. Also

in September 2004, the House Transportation and Infrastructure Committee reported three

other bills. They were (1) H.R. 784, to reauthorize section 221 of the act and provide $1.5

billion over six years for sewer overflow projects (H.Rept. 108-675); (2) H.R. 4470, to

extend the Lake Pontchartrain Basin Restoration Program in Section 121 through FY2010

(H.Rept. 108-676); and (3) H.R. 4688, to reauthorize the Chesapeake Bay Program through

FY2010 (H.Rept. 108-677). The House passed H.R. 4470 on October 7, 2004, but no further

action occurred. Also on October 7, the House passed H.R. 4794, to amend and reauthorize

the Tijuana River Valley Estuary and Beach Sewage Cleanup Act (P.L. 106-457) in order to

address treatment of sewage from Tijuana, Mexico, that impacts the San Diego border

region. The Senate passed this bill on November 16, 2004, and the President signed it on

November 30 (P.L. 108-425; this law does not amend the CWA).

109th Congress. In December 2005, Congress passed H.R. 3963 (H.Rept. 109-293),

authorizing $40 million per year for six years to extend the Long Island Sound program

under Section 119 of the act. President Bush signed it on December 22 (P.L. 109-137). Also

in December, the House approved H.R. 1721 (H.Rept. 109-292), to extend the coastal water

quality program in Section 406 of the act and to authorize $30 million over six years for

coastal water quality monitoring.

On July 20, the Senate Environment and Public Works Committee approved S. 1400

(S.Rept. 109-186), authorizing federal funds for water quality and drinking water State

Revolving Fund programs (see discussion below). On May 18, the House Transportation and

Infrastructure Committee approved bills to reauthorize two other existing CWA programs.

The bills are (1) H.R. 624 (H.Rept. 109-166), to reauthorize Section 221 of the act and

provide $1.5 billion over six years for sewer overflow projects (identical to H.R. 784 from

the 108th Congress) and (2) H.R. 1359 (H.Rept. 109-167), to extend Section 220 of the act,

authorizing a pilot program for alternative water source projects (H.R. 1560 and S. 2550 in

the 108th Congress also would have reauthorized Section 220 — see discussion of these bills

below).

Recovery from Hurricanes. Throughout the Gulf Coast region affected by

Hurricanes Katrina and Rita, high winds and water damaged a wide range of public service

facilities, including sewage treatment plants, and restoring those facilities is part of the

overall cleanup and restoration process. Damages at many facilities included loss of electric

power after the storm to pump, process, and treat raw water supply and wastewater. EPA

and the U.S. Army Corps of Engineers staff are assisting state and local government

personnel to evaluate damages. Efforts to assess facilities continue throughout the region to

determine their operating status, including needs to repair or rebuild, but EPA reported that

by October 10, more than 95% of wastewater treatment facilities in the affected region were

operational, although many may require major repairs or rebuilding. Even months after the

storms, facilities in some cities (serving parts of New Orleans, for example) are not

operational. (For information, see CRS Report RS22285, Hurricane-Damaged Drinking

Water and Wastewater Facilities: Impacts, Needs, and Response, by Claudia Copeland.) The

109th Congress has been considering a wide range of legislative proposals to aid generally

in response and recovery. In particular, S. 1709, passed by the Senate on September 27,

would modify the revolving loan provisions of the Clean Water Act to provide favorable

treatment (such as forgiveness of loan principal and extended repayment) for sewage

treatment repair or rebuilding projects in Alabama, Mississippi and Louisiana. It also would

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permit those states for two years to provide CWA assistance even for projects not included

on a state’s Intended Use Plan, since many of the systems affected by Hurricane Katrina are

believed to not be included in the plans. More generally, some have suggested that

environmental review and permitting requirements of the Clean Water Act and other federal

environmental laws should be modified to enable swift recovery from the storms. Several

bills with provisions intended to do so have been introduced (S. 1711, S. 1765/S. 1766) and

could receive congressional consideration.

Wastewater Security. Since the September 11, 2001 terrorist attacks in the United

States, congressional attention has focused on security, preparedness, and emergency

response issues. Among the topics of interest are protection of the nation’s water

infrastructure facilities (both drinking water and wastewater) from possible physical damage,

biological/chemical attacks, and cyber disruption. (For information, see CRS Report

RL32189, Terrorism and Security Issues Facing the Water Infrastructure Sector, by Claudia

Copeland and Betsy Cody.)

Policymakers have examined a number of legislative options in this area, including

enhanced physical security, communication and coordination, and research. In October

2002, the House passed legislation to authorize $200 million in grants for security activities

at wastewater treatment plants (H.R. 5169). It also authorized $15 million in technical

assistance for small treatment plant facilities and $5 million to EPA for improved

vulnerability assessment tools. Similar legislation was introduced in the Senate (S. 3037),

but no further action occurred. Congress did enact legislation authorizing $160 million in

grants for drinking water utilities to conduct vulnerability assessments (P.L. 107-188).

In the 108th Congress, the House passed legislation similar to H.R. 5169. H.R. 866

(H.Rept. 108-33) would authorize $200 million in grants to wastewater utilities to conduct

vulnerability assessments and an additional $20 million for technical assistance and

improved assessment tools. The Senate Environment and Public Works Committee

approved a similar bill (S. 1039, S.Rept. 108-149) in May 2003. No further action occurred,

due in part to concerns expressed by some that the legislation would not mandate

vulnerability assessments and would not require that they be submitted to EPA, as is the case

with drinking water assessments required by P.L. 107-188.

Wastewater security issues are again receiving attention in the 109th Congress. On May

23, the Senate Environment and Public Works Committee approved S. 2781. It is similar

to S. 1039 in the 108th Congress in that it encourages wastewater utilities to conduct

vulnerability assessments and authorizes $220 million to assist utilities with assessments and

preparation of site security plans. It also includes provisions responding to a March 2006

GAO report that found that utilities have made little effort to address vulnerabilities of

collection systems, which may be used by terrorists to introduce hazardous substances or as

access points for underground travel to a potential target (Securing Wastewater Facilities,

Utilities Have Made Upgrades but Further Improvements to Key System Components May

Be Limited by Costs and Other Constraints, GAO-06-390). S. 2781 authorizes EPA to

conduct research on this topic. During consideration of the bill, the Senate committee

rejected an amendment that would have required, rather than encouraged, treatment works

to conduct vulnerability assessments and also would have required high-risk facilities to

switch from using chlorine and similar hazardous substances to other chemicals that are often

referred to as “inherently safer technologies.”

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Legislative Issues in the 109th Congress

The year 2002 marked the 30th anniversary of passage of the Clean Water Act and 15

years since the last major amendments to the law. While, as noted, there has been

measurable clean water progress as a result of the act, observers and analysts agree that

significant water pollution problems remain. However, there is less agreement about what

solutions are needed and whether new legislation is required. Several key water quality

issues exist: evaluating actions to implement existing provisions of the law, assessing

whether additional steps are necessary to achieve overall goals of the act that have not yet

been attained, and defining the appropriate federal role in guiding and paying for clean water

infrastructure and other activities. For some time, efforts to comprehensively amend the act

have stalled as interests have debated whether and exactly how to change the law. Many

issues that might be addressed involve making difficult tradeoffs between impacts on

different sectors of the economy, taking action when there is technical or scientific

uncertainty, and allocating governmental responsibilities for implementing the law.

These factors partly explain why Congress has recently favored focusing legislative

attention on narrow bills to extend or modify selected CWA programs, rather than taking up

comprehensive proposals. Other factors also are at work. These include a general reluctance

by most Members of Congress to address controversial environmental issues in view of the

slim majorities held by political parties in the House and the Senate; lack of presidential

initiatives on clean water issues (neither the Clinton nor the Bush Administration proposed

CWA legislation); and since the terrorist attacks of September 11, 2001, a prominent

congressional focus on security and terrorism issues than on many other topics, including

environmental protection.

Authorization of Water Infrastructure Funding

The act’s program of financial aid for municipal wastewater treatment plant

construction is a central feature of the law. At issue today is how the federal government will

assist states and cities, especially in view of the high projected funding needs that exist. It

has received attention in the 109th Congress, as it has for several years, although

controversies have stymied enactment of new legislation. Since 1972, Congress has provided

a total of $75 billion to assist cities in constructing projects to achieve the act’s requirements

for secondary treatment of municipal sewage (equivalent to 85% reduction of wastes), or

more stringent treatment where required by local water quality conditions. The CWA does

not authorize funds for operation or maintenance of completed projects. State and local

governments have spent more than $25 billion of their own funds for construction, as well.

In addition to CWA programs, other sources of federal funding are administered by the U.S.

Department of Agriculture and the Department of Housing and Urban Development (for

information, see CRS Report RL30478, Federally Supported Water Supply and Wastewater

Treatment Programs).

Nevertheless, funding needs remain very high: an additional $181 billion nationwide

for all types of projects eligible for funding under the act, according to the most recent Needs

Survey estimate by EPA and the states, completed in August 2003 (available at [http://

www.epa.gov/owm/mtb/cwns/2000rtc/toc.htm]. In September 2002, EPA released a study,

called the Gap Analysis (available at [http://www.epa.gov/owm/gapreport.pdf]), that assessed

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the difference between current spending for wastewater infrastructure and total funding needs

(both capital and operation and maintenance). EPA estimated that, over the next two

decades, the United States needs to spend nearly $390 billion to replace existing wastewater

infrastructure systems and to build new ones (including for some projects not currently

eligible for CWA funds, such as system replacement, which are not reflected in the EPAstate Needs Survey). Funding needs for operation and maintenance, which are not currently

eligible for federal aid, are an additional $148 billion, the agency estimates. According to

the Gap Analysis, if there is no increase in investment, there will be about a $6 billion gap

between current annual capital expenditures for wastewater treatment ($13 billion annually)

and projected spending needs. The study also estimated that, if wastewater spending

increases by 3% annually, the gap would shrink by nearly 90% (to about $1 billion annually).

Outside groups, including a coalition called the Water Infrastructure Network, have offered

proposals that have attracted some congressional interest for a multibillion dollar investment

program in wastewater and drinking water infrastructure. (For additional information, see

CRS Report RL31116, Water Infrastructure Needs and Investment: Review and Analysis of

Key Issues, by Claudia Copeland and Mary Tiemann.)

The 1987 amendments initiated a program of grants to capitalize State Water Pollution

Control Revolving Funds (SRF), or loan programs. This program in Title VI of the act

replaced the previous categorical grants program, under which the federal share was 55% of

project costs, and localities were not obligated to repay federal funds that they received.

Under the revolving fund concept, monies used for construction will be repaid by borrowing

communities to the states, to be recycled for future construction in other communities, thus

providing an ongoing source of financing. States must provide a 20% match of the federal

amount. The intent of the 1987 amendments was that federal contributions to SRFs would

assist in making a transition to full state and local financing by FY1995. The essential

tradeoff was that states would have greater flexibility to set priorities and administer funding

in exchange for ending federal aid after FY1994. (For additional information, see CRS

Report 98-323, Wastewater Treatment: Overview and Background, by Claudia Copeland.)

All states have established the mechanisms to administer the new loan programs and

have been receiving SRF capitalization funds under Title VI for several years. Many have

complained that the SRF program is unduly complicated by federal rules, even though

Congress had intended that states were to have greater flexibility. Congressional oversight

has examined the progress toward reducing the backlog of wastewater treatment facilities

needed to achieve the act’s water quality objectives, while newer estimates of future funding

needs have drawn increased attention to the role of the SRF program in meeting such needs.

Small communities and states with large rural populations have experienced the largest

share of problems with the SRF program. Many small towns did not participate in the

previous construction grants program and consequently are likely to require major projects

to achieve compliance with the law. Yet these communities often lack an industrial tax base

and thus face the prospect of very high per capita user fees, if their citizens are required to

repay the full capital cost of sewage treatment projects.

While the initial intent was to phase out federal support for this program, Congress has

continued to appropriate SRF capitalization grants to the states, providing an average of

$1.35 billion annually in recent years. The SRF provisions have been less controversial than

others in the act, such as wetlands reform, because of apparent general agreement on the need

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to provide funding assistance (as reflected in continued appropriations). The CWA’s SRF

provisions also were a model for similar provisions added to the Safe Drinking Water Act

(SDWA) in 1996 (P.L. 104-182). However, because remaining clean water funding needs

are still so large, at issue is whether and how to extend SRF assistance to address those

needs, how to allocate SRF funds among the states, and how to prioritize projects and

funding. Bush Administration officials have said that infrastructure funding needs go beyond

what the federal government can do on its own. Of particular concern is assisting small and

economically disadvantaged communities that have had the most difficulty in adjusting from

the act’s previous categorical grants program to SRF loans. Additionally, there is concern

about the adequacy of SRF or other funding specifically for projects dealing with problems

of overflows from municipal combined and separate sewers which can release partially

treated or untreated wastewaters that harm public health and the environment. EPA

estimates that the cost of projects to control sewer overflows, from combined and separate

sanitary sewer systems, is nearly $140 billion nationwide. And more recently, wastewater

utilities have sought assistance to assess operational vulnerabilities and upgrade physical

protection of their facilities against possible terrorist attacks that could threaten water

infrastructure systems. (Water infrastructure funding issues related to annual appropriations

also are an issue of interest to Congress; for information see CRS Issue Brief IB89102, Water

Quality: Implementing the Clean Water Act, by Claudia Copeland.)

Legislative Responses. The 107th Congress considered but did not pass legislation

to address infrastructure funding issues. House and Senate committees approved bills to

extend the act’s SRF program through FY2007 and increase federal assistance (H.R. 3930,

S. 1961), but neither bill received further action, in large part due to controversies over

application of prevailing wage requirements of the Davis-Bacon Act and over the formula

for allocating SRF grants among the states.

In the 108th Congress, four bills to reauthorize the Clean Water Act SRF program were

introduced (S. 170, S. 2550, H.R. 20, H.R. 1560). In addition, separate bills to reauthorize

funding for sewer overflow grants (CWA Section 221) were introduced (H.R. 784, S. 567).

On October 7, 2004, the Senate Environment and Public Works Committee reported

legislation authorizing $41.25 billion over five years for wastewater and drinking water

infrastructure programs, including $20 billion for the clean water SRF program (S. 2550,

S.Rept. 108-386). The bill included a new formula for state-by-state allocation of clean

water SRF grants, renewal of the Clean Water Act’s sewer overflow grant program, and

provisions such as extended loan repayments and subsidies for disadvantaged communities.

Prior to the Senate committee’s action, in July 2003, the House Transportation and

Infrastructure Subcommittee on Water Resources and Environment approved H.R. 1560,

legislation similar to H.R. 3930, the bill approved by that committee in 2002. H.R. 1560

would have authorized $20 billion for the clean water SRF program for FY2004-FY2008.

It included several provisions intended to benefit economically disadvantaged and small

communities, such as allowing extended loan repayments (30 years, rather than 20) and

additional subsidies, including principal forgiveness and negative interest loans, for

communities that meet a state’s affordability criteria. It includes provisions to require

communities to plan for capital replacement needs and to develop and implement an asset

management plan for the repair and maintenance of infrastructure that is being financed.

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(For information, see CRS Report RL32503, Water Infrastructure Financing Legislation:

Comparison of S. 2550 and H.R. 1560, by Claudia Copeland and Mary Tiemann.)

The issue of the applicability of the prevailing local wage requirements of the DavisBacon Act to SRF-funded projects has affected consideration of water infrastructure

legislation for some time, because that act has both strong supporters and critics in Congress.

Critics of Davis-Bacon say that it unnecessarily increases public construction costs and

hampers competition, while supporters say that it helps stabilize the local construction

industry by preventing competition that would undercut local wages and working conditions.

The bill approved by the House subcommittee in July 2003 did not include language

specifying that the Davis-Bacon Act shall apply to SRF-funded projects, while the bill

approved by the Senate Environment and Public Works Committee did include such a

requirement. Other factors that clouded the bills were Administration opposition to

authorization levels in S. 2550 and H.R. 1560 and dispute over funding allocation formulas.

In the 109th Congress, the Senate Environment and Public Works Committee approved

S. 1400, the Water Infrastructure Financing Act, on July 20 (S.Rept. 109-186). The bill is

similar to S. 2550 in the 108th Congress; it authorizes $20 billion for grants to capitalize the

Clean Water Act SRF program and $15 billion for Safe Drinking Water Act SRFs through

FY2010. As approved by the committee, S. 1400 would revise and update the CWA formula

for state-by-state allocation of SRF monies and also would specify that the prevailing wage

requirements of the Davis-Bacon Act shall apply to all projects financed from an SRF (as

similarly provided in the committee’s bill in the 108th Congress).

On June 8 and 14, 2005, the House Transportation and Infrastructure Subcommittee on

Water Resources and Environment held hearings on alternative means to fund water

infrastructure projects in the future. At the first hearing, witnesses focused on one way to

increase funding for water infrastructure that has recently been advocated by some groups,

creating a national clean water trust fund that would conceptually be similar to trust funds

that exist for highway and aviation projects. Witnesses and subcommittee members

discussed difficulties in identifying potential revenue sources that would be deemed fair and

equitable. The second hearing addressed other financing options, such as expanded use of

tax-exempt private activity bonds, and more efficient management techniques, such as asset

management programs and sustainable infrastructure initiatives. In December, legislation

was introduced in the House to establish a $7.5 billion federal trust fund for wastewater

infrastructure improvements. This bill, H.R. 4560, uses a concept for funding such projects

that has been promoted by wastewater treatment industry officials, other stakeholders, and

some environmentalists, who argue it could provide a new source of money for necessary

system upgrades amid dwindling federal funds. The bill contemplates a system of user fees

to create the fund, but the source of revenue is not specified in the bill.

Other Clean Water Act Issues

Several other CWA issues could receive congressional attention.

Regulatory Protection of Wetlands. How best to protect the nation’s remaining

wetlands and regulate activities taking place in wetlands has become one of the most

contentious environmental policy issues, especially in the context of the CWA, which

contains a key wetlands regulatory tool, the permit program in Section 404. It requires

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landowners or developers to obtain permits for disposal of dredged or fill material that is

generated by construction or similar activity into navigable waters of the United States,

including wetlands. Section 404 has evolved through judicial interpretation and regulatory

change to become one of the principal federal tools used to protect wetlands, although that

term appears only once in Section 404 itself and is not defined there. At the same time, its

implementation has come to be seen as intrusive and burdensome to those whose activities

it regulates. At issue today is how to address criticism of the Section 404 regulatory program

while achieving desired goals of wetlands protection. (For additional information, see CRS

Issue Brief IB97014, Wetlands Issues, by Jeffrey Zinn and Claudia Copeland.)

Unlike the rest of the act, the permit aspects of Section 404 are administered by the U.S.

Army Corps of Engineers, rather than EPA, although the Corps uses EPA environmental

guidance. Other federal agencies including the U.S. Fish and Wildlife Service (FWS) and

Natural Resource Conservation Service (NRCS) have more limited roles in the Corps’

permitting decisions. Tension has existed for many years between the regulation of activities

in wetlands under Section 404 and related laws, on the one hand, and the desire of

landowners to develop property that may include wetlands, on the other hand. The conflicts

over wetlands regulation have for the most part occurred in administrative proceedings, as

Congress has not amended Section 404 since 1977, when it provided exemptions for

categories of routine activities, such as normal farming and forestry. Controversy has grown

over the extent of federal jurisdiction and impacts on private property, burdens and delay of

permit procedures, and roles of federal agencies and states in issuing permits.

The Supreme Court’s SWANCC Decision. One issue involving long-standing

controversy and litigation is whether isolated waters are properly within the jurisdiction of

Section 404. Isolated waters that are wetlands which are not physically adjacent to navigable

surface waters often appear to provide only some of the values for which wetlands are

protected, such as flood control or water purification, even if they meet the technical

definition of a wetland. On January 9, 2001, the Supreme Court ruled on the question of

whether the CWA provides the Corps and EPA with authority over isolated waters. The

Court’s 5-4 ruling in Solid Waste Agency of Northern Cook County (SWANCC) v. U.S. Army

Corps of Engineers (531 U.S. 159 (2001)) held that the Corps’ denial of a 404 permit for a

disposal site on isolated wetlands solely on the basis that migratory birds use the site exceeds

the authority provided in the act.

The full extent of impacts on the regulatory program resulting from this decision

remains unclear for now. Environmentalists believe that the Court misinterpreted

congressional intent on the matter, while industry and landowner groups welcomed the

ruling. Policy implications of how much the decision restricts federal regulation depend on

how broadly or narrowly the opinion is applied. Some federal courts have interpreted

SWANCC narrowly, thus limiting its effect on current permit rules, while a few read the

decision more broadly. The government’s current view on this key question was expressed

in EPA-Corps guidance (see [http://www.epa.gov/owow/wetlands/guidance/SWANCC/Joint

_Memo.pdf]) issued on January 15, 2003. It provides a legal interpretation essentially based

on a narrow reading of the Court’s decision, thus allowing federal regulation of some isolated

waters to continue, but it calls for more headquarters review in disputed cases.

Administration press releases say that the guidance demonstrates the government’s

commitment to “no-net-loss” wetlands policy. However, it is apparent that the issues remain

under discussion, because at the same time, the Administration issued an advance notice of

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proposed rulemaking (ANPRM) seeking comment on how to define waters that are under

jurisdiction of the regulatory program. The ANPRM did not actually propose rule changes,

but it indicated possible ways that Clean Water Act rules might be modified to further limit

federal jurisdiction, building on SWANCC and some subsequent legal decisions.

The government received more than 133,000 comments on the ANPRM, most of them

negative, according to EPA and the Corps. Environmentalists and many states opposed

changing any rules, saying that the law and previous court rulings call for the broadest

possible interpretation of the Clean Water Act (and thus a narrow interpretation of

SWANCC), but developers sought changes to clarify interpretation of the SWANCC ruling.

On December 16, 2003, EPA and the Corps announced that the Administration will not

pursue development of rule changes concerning federal regulatory jurisdiction over isolated

wetlands. The EPA Administrator said that the Administration wanted to avoid a

contentious and lengthy rulemaking debate over the issue. Environmentalists and state

representatives expressed relief at the announcement. Interest groups on all sides have been

critical of confusion in implementing the 2003 guidance, which constitutes the main tool for

interpreting the reach of the SWANCC decision. Environmentalists remain concerned about

diminished protection resulting from the guidance, while developers said that without new

regulations, confusing and contradictory interpretations of wetland rules will continue.

Congressional Actions. In September 2002, the House Government Reform

Subcommittee on Energy Policy, Natural Resources, and Regulatory Affairs held a hearing

on the government’s response to the SWANCC decision and to press the government to

clarify its interpretation of the Court case. Committee Members and public witnesses

indicated that a lack of guidance has led to inconsistent regulatory decisions by Corps

officials in individual regions of the country, and subsequent judicial decisions by other

federal and state court have been mixed. At the hearing, Corps and EPA officials testified

on their efforts to develop guidance, which subsequently was released in January 2003.

Concern about lingering confusion over the SWANCC decision and its implementation by

the Corps was the topic of an oversight hearing by the Senate Environment and Public Works

Committee in June 2003. Developers and others in the regulated community criticized the

Corps and EPA, saying that the January 2003 guidance document had not clarified the reach

of federal jurisdiction. A House Transportation and Infrastructure subcommittee also held

a hearing on post-SWANCC issues on March 30, 2004.

While it continues to be difficult to fully assess how regulatory protection of wetlands

will be affected as a result of the SWANCC decision and other possible changes, the

remaining responsibility to protect affected wetlands falls on states and localities. (For

additional information, see CRS Report RL30849, The Supreme Court Addresses Corps of

Engineers Jurisdiction Over ‘Isolated Waters’: The SWANCC Decision, by Robert Meltz and

Claudia Copeland.)

Controversies about the SWANCC guidance issued by EPA and the Corps in 2003

persist. In response, on May 18 the House adopted an amendment to a bill providing

FY2007 appropriations for EPA (H.R. 5386). The amendment (passed by a 222-198 vote)

would bar EPA from spending funds to implement the 2003 policy guidance. Supporters of

the amendment said that the guidance goes beyond what the Supreme Court required in

SWANCC, has allowed many streams and wetlands to be unprotected from development, and

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has been more confusing than helpful. Opponents of the amendment predicted that it would

make EPA’s and the Corps’ regulatory job more difficult than it already is.

Legislation to overturn the SWANCC decision by providing a broad definition of

“waters of the United States” has been introduced in the 109th Congress (H.R. 1356, the

Clean Water Authority Restoration Act of 2005). Other legislation to narrow the definition

of “waters of the United States” also has been introduced (H.R. 2658, the Federal Wetlands

Jurisdiction Act of 2005). (For additional information and discussion of similar legislation

in the 108th Congress, see CRS Issue Brief IB97014, Wetland Issues, by Jeffrey A. Zinn and

Claudia Copeland.)

TMDLs and State Water Quality Standards. The CWA requires states to identify

pollution-impaired water segments and develop “total maximum daily loads” (TMDL) that

set the maximum amount of pollution that a water body can receive without violating water

quality standards. A TMDL is essentially a plan to allocate responsibility for implementing

pollution control measures within an area or watershed in order to remedy water quality

impairments. Until recently, there had been little implementation of the TMDL provision

(Section 303(d)), which Congress enacted in 1972. Since the early 1990s, environmental

groups have filed lawsuits in 40 states to pressure EPA and states to meet the law’s

requirements. Of the suits tried or settled to date, more than half have resulted in court

orders requiring expeditious development of TMDLs, thus driving the program that had

previously received little attention. At issue today are controversies over implementation of

the existing TMDL program and regulatory revisions that EPA issued in July 2000, partly

in response to the lawsuits to strengthen the program. That rule was highly controversial

(and never went into effect) because of issues such as potential burdens on states, industries,

cities, and others to implement a revised TMDL program and potential impacts on some

agriculture and forestry sources, which are not now directly subject to CWA regulations.

Because of those controversies, the Clinton Administration delayed the effective date of the

2000 rule until October 2001.

In the FY2001 appropriations act funding EPA, P.L. 106-377, Congress requested a

study by the National Academy of Sciences (NAS) on the scientific basis of the TMDL

program. The NAS report was issued in June 2001 (National Research Council, NAS,

Assessing the TMDL Approach to Water Quality Management). It did not specifically

analyze the July 2000 revised regulations. The NAS panel concluded that scientific

knowledge exists to move forward with the TMDL program and recommended that EPA and

states use adaptive implementation for TMDL development. In many cases, the report said,

water quality problems and solutions are obvious and should proceed without complex

analysis. In other cases, solutions are more complex and require a different level of

understanding and something like phased implementation. In addition, the General

Accounting Office (now the Government Accountability Office) concluded in a report that

inconsistent monitoring, data collection, and listing procedures used by states to identify

impaired waters have hindered efforts to develop effective TMDL programs (Water Quality:

Inconsistent State Approaches Complicate Nation’s Efforts to Identify Its Most Polluted

Waters, GAO-02-186).

In October 2001, the Bush Administration announced that it would delay the rule for

18 months (until May 2003) to allow EPA officials time to review the rule and the NAS

report. This action came after a federal court approved the Administration’s request for a

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similar suspension of litigation that is challenging the regulation (nearly a dozen interest

groups have sued EPA over various parts of the TMDL rule). In the interim, existing rules

and requirements and court-sanctioned TMDL schedules (affecting approximately 22 states)

remain in place. (For additional information, see CRS Report 97-831, Clean Water Act and

Total Maximum Daily Loads (TMDLs) of Pollutants, by Claudia Copeland.)

On March 19, 2003, EPA withdrew the July 2000 TMDL rule. EPA officials said that

implementation of the existing TMDL program will continue in the meantime, but that

additional time is needed to decide whether and how to revise the current program. EPA is

considering initiating an entirely new rule or other options, but no further timeframe or

proposal has been announced. Recent congressional attention to these issues has been

limited to oversight hearings held by the House Transportation and Infrastructure

Subcommittee on Water Resources in June and November 2001. The 109th Congress may

examine implementation of existing TMDL requirements and possible regulatory changes,

if issued, in view of continuing disagreement among states, cities, industry, and

environmental advocates about program effectiveness and efficiency.

Other Implementation Issues. Of potential legislative interest are the impacts of

recent court rulings in several cases concerning implementation of existing provisions of the

law and involving questions of whether certain activities require a Clean Water Act discharge

permit. A fundamental element of the act is the requirement that the “discharge of a

pollutant” from a point source shall be pursuant to a permit authorized by the National

Pollutant Discharge Elimination System (NPDES) program under Section 402 of the law.

In 2004, the Supreme Court held that the transfer of polluted water from one waterbody to

another requires a permit, notwithstanding that no new pollutant is added in the process of

transfer (South Florida Water Management District v. Miccosukee Tribe of Indians, 124 S.

Ct. 1537 (2004)). (For information, see CRS Report RL32569, The Supreme Court Revisits

the Environment: Seven Cases Decided or Accepted in the 2003-2004 Term, by Robert

Meltz.) The decision has raised concerns in agricultural areas where such transfers often

occur in supplying irrigation water, presently without a permit.

Also, decisions of federal courts in two cases have held that aerial application of a

pesticide over and into U.S. waters requires a CWA permit, even when the pesticide use

meets other requirements of federal law, including the Federal Insecticide, Fungicide, and

Rodenticide Act (FIFRA). These and related decisions drew the attention of many pesticide

applicators, including public health entities such as mosquito control districts, concerned

with how the rulings might affect their need to control pests associated with diseases such

as the West Nile virus. In January 2005, EPA issued guidance seeking to resolve the conflict

over the regulatory scope of the CWA and FIFRA related to pesticide use, in light of the

recent litigation, and simultaneously proposed a formal rulemaking to promulgate regulations

that would clarify circumstances under which a CWA permit is or is not required for

activities carried out pursuant to FIFRA. Congress has examined these issues in oversight

hearings, one by a House Transportation and Infrastructure subcommittee in October 2002

and another by a House Government Reform subcommittee in October 2004. Legislation

intended to affirm that a CWA permit is not required for use of FIFRA-approved pesticides

has been introduced in the 109th Congress, the Pest Management and Fire Suppression

Flexibility Act (H.R. 1749, S. 1269). A House Transportation and Infrastructure

subcommittee held a hearing on H.R. 1749 on September 29. (For background, see CRS

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Report RL32884, Pesticide Use and Water Quality: Are the Laws Complementary or In

Conflict? by Claudia Copeland.)

LEGISLATION

H.R. 624 (Camp)

Amends the Clean Water Act (Sec. 221) to reauthorize appropriations for sewer

overflow grants; authorizes $250 million annually for FY2006-FY2011. Introduced February

8, 2005, referred to Transportation and Infrastructure Committee. Approved by full

committee May 18, 2005 (H.Rept. 109-166).

H.R. 1359 (J. Davis, FL)

Amends the Federal Water Pollution Control Act to extend the pilot program for

alternative water source projects (Sec. 220) through FY2010 and increase annual

authorizations from $75 million to $125 million. Introduced March 17, 2005, referred to

Transportation and Infrastructure Committee. Approved by full committee May 18, 2005,

with amendment to strike the fiscal year limitation in the bill (H.Rept. 109-167).

H.R. 1721 (T. Bishop)

Amends the Clean Water Act (Sec. 406) to reauthorize appropriations for coastal

recreation waters programs; authorizes $30 million annually for FY2006-FY2011.

Introduced April 20, 2004, referred to Transportation and Infrastructure Committee.

Approved by full committee October 26, 2005 (H.Rept. 109-292). Passed House December

7.

H.R. 3963 (Simmons)

Amends the Clean Water Act (Sec. 119) to reauthorize appropriations for the Long

Island Sound Program; authorizes $40 million annually for FY2006-FY2011. Introduced

September 29, 2005, referred to Transportation and Infrastructure Committee. Approved by

full committee October 26 (H.Rept. 109-293). Passed House December 7. Passed Senate

December 16. Signed by President December 22 (P.L. 109-137)

H.R. 4560 (Duncan)

Clean Water Trust Act of 2005, amends the Clean Water Act to authorize appropriations

for state water pollution control revolving funds and for other purposes; establishes Clean

Water Trust Fund for construction of wastewater infrastructure projects. Introduced

December 15, 2005, referred to Transportation and Infrastructure Committee.

S. 1400 (Chafee)

Water Infrastructure Financing Act, to amend the Clean Water Act and the Safe

Drinking Water Act to improve water and wastewater infrastructure in the United States.

Introduced July 14, 2005, referred to Environment and Public Works Committee. Approved

by full committee, with amendments, July 20, 2005 (S.Rept. 109-186).

S. 1709 (Inhofe)

Gulf Coast Emergency Water Infrastructure Assistance Act. Amends CWA Title VI

to provide favorable treatment for certain projects in response to Hurricane Katrina; also

allows states to provide assistance for wastewater treatment and drinking water projects that

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are not included on states’ intended use plan) Introduced September 15, 2005; referred to

Environment and Public Works Committee. Passed Senate by voice vote September 27.

S. 2781 (Inhofe)

Wastewater Treatment Works Security Act of 2006. Amends the CWA to enhance the

security of wastewater treatment works facilities by encouraging treatment works to conduct

vulnerability assessments and site security plans. Introduced May 8, 2006; referred to

Environment and Public Works Committee. Approved by committee May 23.

FOR ADDITIONAL READING

National Research Council, National Academy of Sciences. Assessing the TMDL Approach

to Water Quality Management. National Academy Press, Washington, D.C. June 2001.

82 p.

U.S. Congressional Budget Office. Future Investment in Drinking Water and Wastewater

Infrastructure. Washington, November 2002. 58 p.

U.S. Environmental Protection Agency. The National Water Quality Inventory: 2000

Report. Washington, September 2002. “EPA-841-R-2-001.” 207 p.

——. The Clean Water and Drinking Water Infrastructure Gap Analysis. Washington,

September 2002. “EPA-816-R-02-020.” 50 p.

——. Clean Watersheds Needs Survey 2000, Report to Congress. Washington, August 2003.

“EPA-832-R-03-001.” 1 vol.

U.S. Government Accountability Office. Key EPA and State Decisions Limited by

Inconsistent and Incomplete Data. (GAO/RCED-00-54) March 2000. 73 p.

——. Water Infrastructure: Information on Financing, Capital Planning, and Privatization.

(GAO-02-764) August 2002. 79 p.

CRS Issue Briefs and Reports

CRS Issue Brief IB89102. Water Quality: Implementing the Clean Water Act, by Claudia

Copeland.

CRS Issue Brief IB97014. Wetland Issues, by Jeffrey Zinn and Claudia Copeland.

CRS Report RL30030. Clean Water Act: A Summary of the Law, by Claudia Copeland.

CRS Report 97-831. Clean Water Act and Total Maximum Daily Loads (TMDLs) of

Pollutants, by Claudia Copeland.

CRS Report RL32884. Pesticide Use and Water Quality: Are the Laws Complementary or

In Conflict? by Claudia Copeland.

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CRS Report 98-323. Wastewater Treatment: Overview and Background, by Claudia

Copeland.

CRS Report 96-647. Water Infrastructure Financing: History of EPA Appropriations, by

Claudia Copeland.

CRS Report RL31116. Water Infrastructure Needs and Investment: Review and Analysis

of Key Issues, by Claudia Copeland and Mary Tiemann.

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