Municipalities nationwide are facing increasing demands to invest in public infrastructure due to stricter compliance requirements, increasing climate impacts, aging infrastructure, and increased resiliency needs. Funding for water infrastructure projects has not previously matched these needs. Due to tighter budgets and competing needs, agencies have had to prioritize capital improvement projects, increase rates, and seek funding from federal, state, and local sources.
Support from the Federal Government
The $1.2 trillion Infrastructure Investment and Jobs Act, commonly referred to as the Bipartisan Infrastructure Law (BIL), was signed into law in November 2021 and includes $550 billion of new spending for water infrastructure, cybersecurity, and resiliency. Over $55 billion is specifically for water utilities, $22 billion of which will flow through State Clean Water and Drinking Water State Revolving Funds (SRF) over the next 5 years. The BIL commits $15 billion in funds for Lead Service Line Replacement (LSLR) projects and $9 billion in grants to address per- and polyfluoroalkyl substances (PFAS) and emerging contaminants.
Additionally, through the US Bureau of Reclamation, $8.3 billion in funding from Western Water Infrastructure provides additional water project opportunities. The BIL and Western Water funding equates
to the single largest investment in water from the federal government!
Equitable Disbursement of Funding
The BIL mandates that 49 percent of SRF and LSLR funding, and 25 percent of PFAS funding, must be provided as grants for disadvantaged communities. A key priority of the BIL is to ensure that disadvantaged
communities benefit equitably from the appropriations for critical water projects, including environmental justice concerns. However, many of these communities face hurdles to access these funds. In addition, to provide some added flexibility, state SRF program managers are working to better define the criteria used to identify a “disadvantaged community,” including consideration of affordability to ensure the distribution of funds.
Don’t Worry, It’s Not Too Late
Federal and state agencies have been developing rules and guidance since November 2021, with the first rounds of funding pushed out in early 2022 through established programs. With the issuance of the Environmental Protection Agency’s (EPA) Implementation Guidance in March 2022, SRF programs are gearing up to award FY 2022/2023 appropriations this summer – including resources for PFAS and LSLR.
It is not too late for water utilities to secure BIL funds for projects. Carollo recommends the following actions to “get in line” for these funding opportunities:
- Plan: Identify projects, funding needs, and schedules.
- Funding Strategy: Identify high-priority projects, project details, and enhancements to make projects more attractive. Develop list of target funding programs and program requirements.
- Have a Voice: Participate in rule-making and guidance development.
- Documentation Readiness: Determine required project documentation for specifics funding programs.
- Market: Meet with funding agencies to market project, gain insight into program priorities, and understand how funding programs fit to your project.
- Federal Requirements: Understand federal requirements (such as Buy America, Build America) and account for impacts in the project budgets and schedules.
- GET IN LINE!
Interested in funding opportunities for your project? Carollo is here to help, from the pursuit phase to design planning! For questions, please contact Seema Chavan (Grants Management Group Lead) at firstname.lastname@example.org or (925) 932-1710.
Read more of this issue of Currents: Currents: Volume 2, 2022