Water Sector Advocates for COVID-19 Aid, Focuses on Next Phase of Stimulus Legislation

Mar 27, 2020

(March 27, 2020) – NACWA and the broader water sector joined together in a formal request to Congress this week to aid water and wastewater utilities in overcoming the challenges posed by coronavirus.

The letter came in the midst of an intense push over the past 10 days to elevate the story of how the clean water sector is responding to the coronavirus, highlight key sector concerns from lost revenue to new workforce challenges, respond to Congressional and Agency inquiries, and set the stage for increased federal investment to advance clean water.

Congress Passes Phase Three Stimulus; Water to Be Considered in Phase Four

Over the past week, the White House and Congress have been working around the clock to reach agreement on what has been dubbed a “Phase Three” coronavirus stimulus legislative package.  NACWA staff has been working alongside Congress to advocate for the needs of the clean water sector, including assistance to help utilities maintain critical services during this pandemic and to mitigate projected losses of utility revenue and impact to scheduled investments. 

Water assistance rapidly gained traction as an important element of coronavirus recovery in both Senate and House negotiations. Unfortunately, the final deal reached this week, the Coronavirus Aid, Relief, and Economic Security Act’’ (CARES Act),’’ does not include financial assistance for water and wastewater.

The final package focused mainly on four pillars advocated by Senate leadership: aid to small businesses, direct cash payments, loans to companies in distressed industries such as airlines, and money to fund the medical response.

While it’s disappointing that Congress did not provide immediate assistance for the water and wastewater agencies that are facing sharp losses in revenue while stepping up to the plate to ensure essential critical services, this was just the first part of a sustained congressional push to address the coronavirus. There is widespread acknowledgement by Congress that additional stimulus legislation is needed with an expanded scope across many sectors. The efforts over the past week by the water sector have laid crucial groundwork the important messaging and groundwork for future stimulus phases.

In the House, the sector was successful in securing provisions in its stimulus proposal to provide $1.5 Billion for water/wastewater ratepayer assistance to be provided via the established Low-Income Home Energy Assistance Program (LIHEAP), as well as $1.5 Billion for the same need directed through the Children and Family Services Program. Both alternatives were debated by House and Senate staff as potential means of getting funding out the door quickly. Congressional staff are already gearing up for the next steps on COVID-19, including these mechanisms alongside traditional water programs. 

A big thanks goes to the NACWA members that reached out to share your concerns, projected economic impacts, and ideas throughout the course of this week – your efforts have captured the attention of key leaders in Congress. A special thanks also to DC Water CEO David Gadis for helping spearhead a letter from individual utilities.  The importance for strong advocacy will continue and NACWA encourages its member utilities to stay engaged.

Broad Finance Coalition Secures Funding Opportunities in CARES Act

While water specifically was not addressed in this week’s congressional package, there are broader funding opportunities for municipal and local governments.

In addition to advocating for water sector assistance specifically, NACWA has been working with local and state governmental partners to secure provisions to aid public sector entities. The final CARES Act includes several provisions that may provide public water utilities with economic assistance through two different pots of money.  NACWA and our coalition partners are working to receive further clarity on how they will be implemented. 

The first pot of money is under section 601 of the bill that provides $150 billion for state, tribes, and local governments for necessary expenditures incurred due to the coronavirus public health emergency. However, this section includes a provision requiring funding only to be directly available to units of local government with populations above 500,000 people. NACWA is working with our state and local government partners to understand the background and intention of this stipulation more carefully, although it appears this was a limitation that originated directly from the White House during negotiations.   

The second pot of money is under section 4003 of the bill which provides $454 billion in liquidity to eligible businesses, states, and municipalities related to losses incurred as a result of coronavirus. This liquidity can be provided through loans, loan guarantees, and federal purchasing of financial obligations. This section does not have the same limitations and stipulations on local governments by size as in section 601.

NACWA also worked to support the local and state government coalition provide funding for public sector employers providing enhanced sick and family leave due to coronavirus. These enhanced paid leave benefits were established in the “Phase Two” stimulus package passed last week and tax credits to offset their cost were provided for private sector – but, inexplicably, funding was not provided for public sector employers incurring these same costs. This also appears to have been a directive from the White House during negotiations. A fix to this unfunded mandate was included in the House bill, but not incorporated into the final Phase 3 package. Efforts will continue to secure a fix.

Finally, of note in the Phase 3 bill, eligible recipients of small business loans under section 1102 are authorized to use their funds to pay utility bills, including water.

What’s Next?

Both the House and Senate are anticipated to recess from Washington from now until at least late April. Congressional staff will continue working during the recess (from home) and NACWA is already engaging with Congress on next steps to advance these water sector priorities.

Meanwhile, Members of Congress will be in their home districts for an extended period – and no doubt are eager to use the time to connect with constituents over the phone, email or virtual meeting. We encourage all utilities to use this opportunity to connect with their Congressional delegation. Water Week, April 26 – May 2nd, will be another good opportunity to make the water sector voice heard during this period.

Contact Kristina Surfus or Jason Isakovic on NACWA’s legislative team to discuss Congressional developments further. As always, the entire NACWA staff welcomes your outreach and stands ready to offer any help we can during this challenging time.

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