The President has signed the America’s Water Infrastructure Act of 2018 (“AWIA”) recently passed by the Congress. AWIA builds on previous water infrastructure finance incentives, particularly, the Water Infrastructure Finance and Innovation Act of 2014 (“WIFIA”), which authorized major financial incentives to be administered by either the Environmental Protection Agency (“EPA”) or the U.S. Army Corps of Engineers (the “Corps”). Four years later, only those provision of WIFIA promoting water infrastructure through the EPA-administered programs have received Congressional appropriation and are now fully functioning.
AWIA now authorizes more specific implementation of important roles and responsibilities delegated to the Corps by WIFIA. It does not, however, provide matching appropriations for Corps’ projects, which include a backlog of almost $100 million of unfunded projects. Importantly, AWIA also turbo-charges the financial leverage of WIFIA low-cost water infrastructure financing by preserving funding for State Revolving Fund programs, enabling states to bundle multiple projects into a single WIFIA financing application, and providing direct funding to state financing agencies.
What’s In AWIA and What’s Not
WIFIA divided responsibility for water infrastructure finance and development management between the EPA, for drinking and wastewater infrastructure, and the Corps, for flood and storm control, environmental restoration, navigation, waterways, harbors and ports. Only the portion of WIFIA administrated by the EPA has received implementing appropriations under AWIA.
Apart from less than $4 billion for Corps’ civil works projects, 2019 appropriation of $7 billion, and supplemental emergency funding, AWIA funding is weighted toward supporting studies and analyses and authorization of more specific implementation of roles and responsibilities delegated to the Corps by WIFIA. Funding of specific water infrastructure development is mainly left for future appropriation. Thus, implementation of Corps’ water infrastructure projects continue to lag behind those administered by the EPA. These include $100 million of unfunded Corps’-administered projects.
Other key components of AWIA fund SRF capitalization grant programs and the debt default subsidies of WIFIA, prioritize green infrastructure and renewable energy, improve drinking water standards, allow bundling of multiple projects in a single loan application (thus qualifying smaller projects missing the $20 million WIFIA loan threshold), and otherwise streamline the application process.