Blumenauer and Co. Face Off With Utility Industry Over Clean Water

As anyone who's tried to get around during a water main break knows, good old H2O has its own infrastructure and its own role in local transportation.

earl_1.jpgRep. Earl Blumenauer (D-OR), at podium, and colleagues at today's clean water fund event. (Photo: Blumenauer's office)
But many Americans may not know how much states need to close the gap in their clean water revolving funds, to which Congress contributes every year. The deficit is estimated as high as $500 billion over the next 20 years, according to the Environmental Protection Agency (EPA).

At a time when lawmakers readily bail out financial firms, is there a constituency for rescuing the nation's water systems? Rep. Earl Blumenauer (D-OR) and four fellow House members of both parties say yes.

The group of five offered legislation today to set up a $10 billion trust fund that would help states repair aging wastewater treatment plants, sewers, and pipes.

The fund would be paid for with several small taxes on industries that produce and consume water-based goods as well as items that are flushed into public water supplies. (The full list of proposed taxes is after the jump.)

Yet given the political radioactivity of tax increases -- lawmakers have shown scant enthusiasm for raising the gas tax, for instance -- a potent political message is needed to rally support for water infrastructure programs.

And such a message was offered in four stark letters today at a House transportation committee hearing on the water trust fund: J-O-B-S.

Thomas Walsh of the National Association for Clean Water Agencies said his economic modeling showed that every $1 billion investment in water infrastructure creates 27,000 middle-class jobs on the local level.

The American Society of Civil Engineers is also supporting Blumenauer's bill. Water utility officials, however, argued that government reports on the urgency of the clean water funding gap amount to hyperbole.

"It's not a crisis ... it's not all crumbling," Hamlet Barry, representing the American Water Works Association.

Barry said the water industry now puts $80 billion a year into water infrastructure and suggested that the funding gap could be closed if utilities imposed small rate increases on everyday customers.

Bill Hillman, the CEO of the National Utility Contractors Association, lamented that "the American public is unwilling to pay for what they want" from the water supply. "It's unlike transportation infrastructure; it's out of sight, out of mind."

The $787 billion economic stimulus law gave $4 billion to state clean water revolving funds, but the precarious state of the federal budget is likely to keep Blumenauer's bill in the long-term funding mix this year.

(The taxes that would fund Blumenauer's clean water trust fund are a 0.15 percent tax on corporate profits, a 4-cent tax per container on water-based beverages such as Gatorade, a 3 percent tax on soaps and other items flushable in public water supplies, and a 0.5 percent tax on pharmaceuticals.)