Drinking Water Funds on Democrats’ Agenda Fall Short of Need

  • House tax and spending bill includes $10 billion for lead remediation
  • Senate unlikely to add funding for 100% lead line replacements

Bloomberg Government subscribers get the stories like this first. Act now and gain unlimited access to everything you need to know. Learn more.

President Joe Biden’s ambitious $45 billion request to completely remove lead from U.S. drinking water systems finds itself on the cutting room floor as Democrats’ negotiate their tax and spending bill through a narrowly divided Congress.

Funds for the drinking water system lead remediation projects is down to around $10 billion, far from early requests but enough that advocates see the potential to begin work that can carry on in future years.

An early House version of Biden’s economic package, known as the Build Back Better Act, pared the initial request to $30 billion in funds to replace 100% of lead service lines across the country. That figure is about half of the $60 billion the American Water Works Association estimated the complicated project will ultimately cost. The bill the House eventually passed on Nov. 19 (H.R. 5376) contained less than $10 billion for lead remediation and replacement projects.

Of the roughly $10 billion, $9 billion is targeted for the Environmental Protection Agency to replace residential service lines in disadvantaged communities and to address lead in schools, while almost $1 billion would go to the Agriculture Department for lead service line replacement in rural communities. There are roughly 10 million lead service lines still in operation, many in low-income neighborhoods and communities of color.

Now that Congress has checked off one major item from its to-do list, passing a measure on Thursday to fund the government through Feb. 18, it can turn its attention to the measure, which Democrats are advancing via the reconciliation process to avoid the need for Republican support. Senate Majority Leader Chuck Schumer (D-N.Y.) said he wants to vote on the bill by Christmas, though there are plenty of issues to resolve before then.

Photo by Justin Sullivan/Getty Images

Rep. Paul Tonko (D-N.Y.) told Bloomberg Government the reduced investment in the Build Back Better legislation ahead of House passage was necessary to get the “support from all the forces to get the votes you need.” Still, he said the $10 billion on top of the $15 billion in funding to replace lead service lines in the bipartisan infrastructure law (Public Law 117-58) is “a good start” to spur what should be a long-term investment from the federal government.

“I think people will understand the value added that comes with these projects, and they’ll be behind additional funds,” said Tonko, who leads Energy and Commerce’s Environment and Climate Change Subcommittee. “We are going to continue to work on all the gaps in energy and environment that are out there.”

The Senate’s bill, which will have differences from the House legislation, isn’t likely to increase the $10 billion to remove lead pipes. A person familiar with the Senate negotiations said Democrats in the chamber worked closely with their House counterparts as they drafted the bill, and the $10 billion figure is unlikely to change.

But progressives, including Rep. Alexandria Ocasio-Cortez (D-N.Y.), are still pushing for more money for lead pipe replacement in the legislation.

“We cannot as a party, any member from the House to the White House, we cannot promise people that their lead pipes can be fixed if we are not funding their lead pipes to be fixed,” she said in a brief interview. “And so, my hope is that the lead pipe funding is preserved in reconciliation, if not expanded, and that it survives both the House and the Senate.”

‘It’s Going to Take Time’

Water advocates outside of Congress are pleased with the investment lawmakers have come up with so far, but they also say the scope of the problem is vast, requiring more than just a short-term infusion of money.

“Completely eliminating lead service lines is not something that can be accomplished with money alone, because many lead service lines are owned by private homeowners,” Dan Hartnett, chief advocacy officer for legislative and regulatory affairs at the Association of Metropolitan Water Agencies, said over email. “Utilities cannot replace them without each homeowner’s permission and cooperation, so funding needs to be combined with local policies that encourage homeowners to work with utilities on these projects.”

The utilities don’t own the part of the service line that begins at a homeowner’s property line, so they need to get buy-in from residents to complete the project, and then work with them on payment. In Cincinnati, Ohio, a homeowner now would pay on average about $1,800 to cover their part of the cost of replacing a lead service line, said Verna Arnette, deputy director of Greater Cincinnati Water Works. The utility pays 40%, up to $1,500, Arnette said.

Homeowners who can’t afford to pay up front can finance the cost as a special assessment on their tax bill that they pay off over time.

“But we are still finding that some people either don’t have the money for that, or they don’t want to let us into the house,” said Arnette, who has worked at the utility for 20 years. Typically, utilities have to go into residents’ homes to install the new line. “There are just a lot of challenges with the whole private property issue,” he said.

There are about 42,000 lead lines in Cincinnati, an older city, and the utility is removing about 800 per year, Arnette said, adding they hope to bump that number to 1,200. “But you do the math, and it’s going to take time.”

Workforce, Materials Challenges

If federal investments continue for the next 15 to 20 years, utilities can develop the workforce they need to replace all the service lines, said Jeff Swertfeger, superintendent of water quality treatment for Greater Cincinnati Water Works.

“Right now, when there’s not that money there, there are little spurts of it here and there, it’s hard to develop that capacity in your community,” he said. “If the money is there, the work is certainly there, we’ll have people coming up and doing it.”

Finding sufficient labor and materials are also challenges, Arnette and Swertfeger said .

“There are only so many contractors out there to do this kind of work,” said Swertfeger. “I don’t how long it’s going to take us to do $15, $25 billion worth of work, but it’s certainly nothing that is going to get done in the very, very short term.” Arnette added that the utility has had difficulty at times obtaining copper pipe to replace the lead.

Congress could also consider providing homeowners with tax credits they could use to recoup some of the cost of replacing lead service lines as well, Swertfeger and Arnette said. In Cincinnati, residential lead service lines exist in both high- and low-income neighborhoods, Arnette said. “It’s really the age of the home.”

Swertfeger doesn’t believe there is a “magic bullet” to complete lead line replacement “but I think the more and more we try to incentivize people to get the line removed and participate with the utility to do that, that would be helpful,” he said.

Tonko said the initial investment from the federal government should be “inspirational” to local utilities and homeowners. “I think as they see this, as requests come in, I think they are going to see a partnership, I would hope,” he said. “Because no child and no family should be drinking lead-infested waters.”

To contact the reporter on this story: Kellie Lunney in Washington at klunney@bloombergindustry.com

To contact the editors responsible for this story: Zachary Sherwood at zsherwood@bgov.com; Heather Rothman at hrothman@bgov.com

Stay informed with more news like this – from the largest team of reporters on Capitol Hill – subscribe to Bloomberg Government today. Learn more.