Statement of the

American Council of Engineering Companies

on

S. 1961

The Water Investment Act of 2002

before the

Committee on Environment and Public Works

Fisheries, Wildlife, and Water Subcommittee

U.S. Senate

February 28, 2002

The American Council of Engineering Companies (ACES) is pleased to provide this statement in support of S. 1961, The Wastewater Investment Act of 2002. The Water Investment Act of 2002 would amend and reauthorize the Clean Water Act and the Safe Drinking Water Act to provide substantially greater funding for wastewater and drinking-water facilities. We commend the Committee for taking the lead on the increased authorization for water infrastructure and we applaud this bi-partisan effort.

The American Council of Engineering Companies (ACEC) is the business association of America’s engineering industry, representing 6,000 independent engineering companies throughout the United States engaged in the development of America’s transportation, environmental, industrial, and other infrastructure. Founded in 1910 and headquartered in Washington, D.C., ACEC is a national federation of 51 state and regional organizations.

ACEC is pleased to support passage of S. 1961, the Water Investment Act of 2002. The proposed funding levels in the bill are a far-sighted, responsible attempt to rebuild the nation's aging and failing wastewater and drinking-water facilities and to upgrade their performance to meet the nation's health and security needs in the 21st century. As a founding member of the Water Infrastructure Network (WIN), ACEC has worked with our coalition partners to raise awareness among Members of Congress and the public about the critical gap that exists between our nation’s water infrastructure funding needs and what is currently being appropriated.

WIN has released reports that outline a projected shortfall of $23 billion per year over the next twenty years in water infrastructure needs and what is currently being appropriated. The report, Water Infrastructure NOW: Recommendation for Clean and Safe Water in the 21^st Century, suggests that the federal investment for water infrastructure is $57 billion over the next five years. Although the authorization in S 1961 does not reach that goal, it represents a significant commitment on the part of the federal government to rectify the problems associated with our nation’s water infrastructure. For too long, the federal government has relied on states, local governments and utilities to fill essentially all of this funding gap. Administrations have failed to request, and Congress has consistently failed to appropriate, the full authorization of $1 billion for the Safe Drinking Water SRF. With the implementation of S 1961, the federal government is taking a significant step towards fulfilling its obligation.

During his State of the Union speech last month, the President outlined his fiscal priorities of defense and homeland security. These are important priorities, but we should not lose sight of other critical national concerns. Improving the nation’s water quality and water systems through infrastructure investment makes good economic sense. For every billion dollars we invest in environmental infrastructure we create over 30,000 jobs. Beyond the creation of thousands of new jobs in the design and construction industry, millions of existing American jobs depend on clean and safe water including those in the $45 billion commercial fishing industry and the $100 billion water recreation industry.

The nation's 54,000 drinking water systems face staggering infrastructure funding needs over the next 20 years. Although America spends billions on infrastructure each year, we estimate that drinking-water systems face an annual shortfall of at least $11 billion to replace aging facilities that are near the end of their useful life and to comply with existing and future federal water regulations. The existing pipes, bricks and mortar that are holding together our current infrastructure system are severely outdated and in need of repair. States are forced to delay construction projects in order to comply with important health and safety mandates by the EPA. With federal requirements on TMDLs, combined sewer overflows, SSOs and arsenic removal, states will likely fall further behind in their efforts to repair and replace pipes. Without a significantly enhanced federal role in providing assistance to drinking water infrastructure, critical investments will not occur. Federal assistance can come in the way of grants, trust funds, loans, and incentives for private investment. The question is not whether the federal government should take more responsibility for drinking-water improvements, but how.

ACEC acknowledges the Committee’s efforts to streamline the federal requirements that hampered accessibility to the SRF program. We support the provisions in S 1961 that broaden the definition of projects and communities that are eligible for federal assistance through the state revolving funds and the flexibility with which those projects can be implemented.

The Water Investment Act of 2002 could be amended to enhance its effectiveness and improve on its ability to build modern wastewater and drinking-water facilities and protect national security. ACEC strongly encourages the Committee to adopt the following provisions to S. 1961 as it deliberates further on this legislation:

· The bill should expressly authorize the Environmental Protection Agency to use the Clean Water Act SRF Loan Fund and the Safe Drinking Water Act SRF to provide financial assistance for the construction of physical security measures at wastewater and drinking water plants. Certain terrorist groups have made it clear that the destruction of U.S. water-treatment facilities is one of their aims. Federal funds should be made available through the SRFs to deal with specific security needs, including improved building design and construction requirements, fencing and other physical security measures. No funds should be made available to hire security guards, establish private police forces or implement other non-structural protections, which should be addressed through operating funds.

· The bill should require that each contract and subcontract for architectural and engineering design services, program and construction management and other professional services should be awarded in the same manner as contracts that are awarded under title IX of the Federal Property and Administrative Services Act of 1949.

· The bill should give a state the discretion to use the design-build project delivery method for each facility financed under the SRFs. The use of this method should be consistent with state law. Once a state decides that the design-build project delivery system is appropriate for a given project, the recipient should be required to the use of the two-phase competitive source-selection procedures authorized under section 303M of the Federal Property and Administrative Services Act of 1949.

In conclusion, we would like to reiterate our support for S 1961 and we thank the four co-sponsors of the legislation, Senators Jeffords, Smith, Crapo and Graham for their leadership on this issue. The engineering community stands ready to help rebuild and replace the aging and failing infrastructure that puts so many communities and citizens at risk.