By Mae Stevens
If you are among the estimated 19.3 percent of Americans (https://bit.ly/3onXkNt) living in a rural county, you understand that rural communities undergo a unique set of challenges compared to those in urban and suburban areas. One that is not often discussed but is up near the top of the list is the provision of drinking water and wastewater services. Due to a variety of technical and financial reasons, the small systems serving our nation’s most rural communities are often at a disadvantage.
The primary challenge for these small systems is that they often have a relatively small base of ratepayers and are unable to develop economies of scale. This can lead to a multitude of issues, including difficulties funding system upgrades, achieving compliance with US EPA regulations, achieving adequate staffing levels as well as accessing funding and financing. With more than 97 percent of the nation’s 156,000 public water systems serving populations of 10,000 or fewer (https://bit.ly/33NgMtm), these are challenges that desperately need attention.
As it has across all sectors of the economy, the COVID-19 pandemic has greatly exacerbated challenges in the water sector, particularly in rural communities. Making matters worse, many rural communities had not fully recovered from the 2008 economic downturn when the pandemic struck in March 2020. According to a survey (https://bit.ly/3fmPD6h) conducted last spring by the Rural Community Assistance Partnership, small water systems estimated they would lose between $3.6-5.5 billion (USD) if the pandemic lasted for a year. As we know, it has lasted much longer than that. Although millions of people are being vaccinated every day in the US, the lingering economic impacts will persist for many months to come.
Thankfully, on April 29 the Senate passed S. 914, the Drinking Water and Wastewater Infrastructure Act (https://bit.ly/3ffnnm0) (DWWIA), by an overwhelmingly bipartisan vote of 89-2. The legislation has broad support from the water industry, environmental advocates, business leaders and labor unions, which bodes well for its chances in the House as well as for future federal investment in the water sector.
DWWIA provides some relief to the challenges that rural utilities face. The bill makes it easier for small, struggling systems to finance upgrades by increasing the percentages of the Drinking Water and Clean Water State Revolving funds that states must spend on grants, negative interest loans and debt forgiveness measures, and reauthorizes grant programs specifically dedicated to small and disadvantaged communities. Additionally, the bill creates or expands several technical assistance provisions to help small utilities access the funding and financing they need to keep their systems in tip-top shape.
DWWIA also creates pilot programs for a low-income assistance program. The inability of low-income customers to afford their water bills is an issue that disproportionately impacts small water systems whose rate-base is often so small and economically homogeneous that it is difficult to buffer those losses. While it would be better if all 156,000 water systems in the US were eligible for this program instead of just the 40 pilots outlined in the bill, this is still a step in the right direction towards the creation of a permanent national program that would better address the issue.
At the time of this writing, it remains to be seen what the House will do with this bill. Because of the overwhelmingly bipartisan vote in the Senate, it is unlikely that this bill will get caught in the bipartisan gridlock for which Washington is known. The timing of passage and how this bill intersects with President Biden’s $2.25 trillion American Jobs Plan (https://bit.ly/3uPiKp5) —which proposes $111 billion in water infrastructure investment over eight years—are still unknown. Keep refreshing wcponline.com for updates!
About the author
Mae Stevens is an Executive Vice President at Signal Group and the Chair of Signal Water. She provides strategic environmental and infrastructure policy expertise to a diverse range of corporate, municipal and non-profit clients. Prior to joining Signal Group, Stevens served as Environmental Policy Advisor to Sen. Ben Cardin (D-MD), handling the Senator’s responsibilities on the Environment and Public Works Committee, including staffing the Senator during the crafting and passage of the FAST Act and the 2016 and 2018 Water Resources Development Act bills.