Water advocates are worried that an upcoming transportation funding measure that is scheduled for a first vote in the Senate on Tuesday will broaden a loan program for port and water projects they say is forcing the expansion of private construction.
Lawmakers are facing a July 31 deadline for the expiration of current infrastructure funding, and they are scrambling to come up with a way to enough money to pay for an extension.
The Washington, D.C.-based group Food and Water Watch said a proposal that is likely to come up in the Senate on Tuesday for a procedural vote could include an expansion of the water project loan program that was created by Congress in 2013, to the chagrin of public water project advocates.
“As the Senate begins to consider a new long-term highway funding bill, there has been discussion of including a change to the existing Water Infrastructure Finance and Innovation Act (WIFIA),” the group’s Executive Director Wenonah Hauter said in a statement.
“The change would enable concurrent use of tax-exempt bonds thus granting broader access to utilize WIFIA,” Hauter continued. “This would result in lost revenue and subsidize a flawed program.”
The program in question, known as WIFIA, is patterned after the popular Transportation Infrastructure Finance and Innovation Act that is often referred to as TIFIA.
The TIFIA program allows state and local governments to apply for low-interest loans that are backed by the federal government to entice corporations to enter into public-private partnerships, which are becoming a popular way to finance large transportation programs.
Lawmakers included $175 million in a water funding bill that was passed last year to start an identical program specifically for port and water projects.
Hauter said Tuesday that the Senate highway bill will likely double down on the water loan financing program, which she said would be bad for the nation’s environment.
“WIFIA is an unacceptable approach to funding local water systems, as it competes with the underfunded State Revolving Funds (SRFs) for federal dollars, and places inappropriate pressure on communities to privatize their water systems,” Hauter said. “Food & Water Watch urges Congress to uphold the ban on using tax-exempt funding along with loans from WIFIA.”
Advocates of the WIFIA program say it makes sense to duplicate a program that has been successful for financing other transportation projects.
Hauter said Congress should focus on finding ways to boost federal funding for water projects, just like they are trying to do with other transportation sectors.
“It is imperative that the federal government uphold its commitment to funding local water systems, not create incentives to abdicate this critical function to private companies,” she said.
“Years of risky experimentation with privatization have shown that water service is most efficient and affordable when administered by a public entity,” Hauter continued. “Any federal program that aims to reduce the cost of improving public water systems would be self-defeating if it promotes privatization as WIFIA does.”
The Senate is expected to hold a vote to begin debate on a legislative vehicle that could contain a multi-year transportation bill on Tuesday afternoon.
Congress is trying to beat a July 31 deadline to replenish the Department of Transportation’s Highway Trust Fund before it dips below critical levels at the end of the month. The agency has warned that it will have to begin cutting back on payments to state and local governments for transportation projects that are already underway unless Congress reaches an agreement on an extension.
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