Millions in water infrastructure funding left unspent

In 1996, Congress established the Drinking Water State Revolving Fund, which provides cities, states and utility agencies with low-interest loans as a means of maintaining the country’s aging water system. For the past few years, Congress has approved $900 million on an annual basis. One in five dollars has gone to paying the salaries of employees and contractors, which leaves less room for repairing and replacing leaking pipes, deteriorating water treatment plants and century-old aquifers.

While the program provides funding for various projects, critics say the money isn’t being spent quickly enough. A variety of state managers have said spending delays are practically unavoidable. The complexity of water projects can take years to complete, which means spending is slowed down.

“It’s not as if the funds are being bungled or poorly spent. It’s a quest of delays,” Jim Taft, executive director of the Association of State Drinking Water Administrators told Townhall.

The Environmental Protection Agency’s inspector general cited the lack of spent money as a sign that residents aren’t receiving the infrastructure improvements they need. By not implementing those improvements, residents aren’t seeing the added health benefits. In addition, states that fail to utilize this funding aren’t seeing the additional benefit that comes with the funding: job creation.

Under the law, every state is entitled to receive at least 1 percent of the funding. After that allotment is given to the states, the EPA allots additional funding based on infrastructure needs. Infrastructure that addresses public health issues is given first priority.

Because the program offers loans rather than grants, it is self-sustainable. There is, however, one problem: cities and states that cannot afford to pay back the loans are often times the areas that are in need of water infrastructure the most.

“The people who have the biggest need are the people who have the worst compliance. They can’t afford to fix it,” Jeff Walker, an administrator with the Tax Water Control Board told Townhall.

For some areas, the only way to complete these projects is through a grant program. If the agencies or cities take the loan, residents would face higher rates.

Since the fund was established in 1996, $28 billion has been spent on more than 11,500 projects.