Water Utility Leaders, Congress Discuss WIFIA Funding

Water leaders to Congress: 'Let's free WIFIA' from tax-exempt bond prohibition
Water Utility Leaders, Congress Discuss WIFIA Funding

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Water utility leaders from across the U.S. met with lawmakers Wednesday on Capital Hill, urging U.S. Congress to repeal a ban on the use of tax-exempt bonds on projects funded by the Water Infrastructure Finance and Innovation Act (WIFIA).

More than 130 water utility leaders from 47 states were in Washington D.C., March 18-19, for the American Water Works Association’s Water Matters! Fly In. According to the AWWA press release, delegates wore “Free WIFIA” buttons as they went to Congress to discuss infrastructure and other water issues.

Signed into law in 2014, WIFIA supplies low-interest federal loans for up to 49 percent of large drinking water, water reuse and wastewater projects. However, the law prohibits tax-exempt bonds from funding the remaining 51 percent.

“The water and wastewater infrastructure needs in the United States will likely top $2 trillion over the next 25 years, and WIFIA is an important tool to help communities manage those costs,” says AWWA CEO David LaFrance.  “But the prohibition on the use of tax-exempt bonds is an unnecessary barrier that impairs WIFIA’s effectiveness.”

The AWWA argues that if the ban were repealed, utilities would likely use lower-cost tax-exempt debt for the non-WIFIA share of project costs, lowering the overall cost of using the WIFIA program. As a result, WIFIA would be a cost-effective option for a broader range of utilities it was intended to serve.

In a meeting with Congress earlier this week, utility leaders also called on lawmakers to support full funding for WIFIA and for drinking water and wastewater state revolving loan fund programs, and to protect the tax-exempt status of municipal bonds.

 

Photo credit: "US Capitol" by keithreifsnyder is licensed under CC BY 2.0.



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