NACWA Presses EPA on Changes to Draft Financial Capability Assessment Guidance

Aug 10, 2022

NACWA sent a letter to senior EPA Office of Water staff on August 8 outlining continued concerns with the Agency’s proposed Financial Capability Guidance (FCA) that was published in draft form earlier this year and asking for additional changes before it is finalized.

The letter follows productive conversations between NACWA members and EPA staff at the Association’s recent Summer Conference in late July.

NACWA’s letter raises additional concerns about the new Financial Alternatives Analysis that is included in the draft FCA and notes that requirements included in the alternatives analysis overstep EPA’s role in local financial capability discussions and impose burdens on utilities that they often do not have the power or authority to address. 

As an example, the letter explains that clean water utilities frequently provide services for multiple communities, each of whom sets rates for their own customers.  Given that reality, a utility cannot simply impose the type of rate considerations included in the alternatives analysis on its member communities. 

NACWA also points out the subjective nature of the types of considerations EPA is trying to force on utilities via the FCA document as currently drafted and raises concerns about the Agency attempting to impose such requirements via a guidance document.

NACWA previously submitted robust comments opposing the draft FCA, and also joined a set of comments with the American Water Works Association and the Water Environment Federation. EPA appears to be moving quickly towards finalization of the FCA in the near future, and NACWA has requested additional engagement with EPA before that happens.

Members with questions can contact Nathan Gardner-Andrews, NACWA’s Chief Advocacy & Policy Officer.

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