House to weigh nearly $15 billion for water, sewers

WASHINGTON Thu Mar 5, 2009 3:20pm EST

WASHINGTON (Reuters) - The U.S. House of Representatives' infrastructure committee approved a sweeping water and sewer bill on Thursday that would add more than $15 billion to the dollars already sent to states under the recently-enacted stimulus plan, but could face a bump when the full body votes on it.

The Water Quality Investment Act of 2009 combines five water bills that the House approved last year, but which stalled in the Senate, including one that would authorize $13.8 billion of federal grants for clean water state revolving funds.

Under the economic recovery bill signed into law last month about $2 billion will go to the revolving funds, which makes low-cost loans and grants to water authorities for building and repairs. President Barack Obama has also included $3.9 billion for the funds in the budget he proposed last week.

The bill approved by the House committee also authorize grants of $250 million over five years for projects relying on alternative water sources and $1.8 billion over the same time span for controlling sewer overflows.

It would send $750 million to states around the Great Lakes for cleaning up pollution in the lakes that border Canada, as well.

Along with the direct grants, the bill includes special financing mechanisms such as principal forgiveness and negative interest loans for individuals who might not be able to pay sewer and water rate increases needed to help pay for improvements.

"This is critical in these economic times," said Eddie Bernice Johnson, a Democrat from Texas, as the committee considered the bill. She added that the annual gap between wastewater infrastructure needs and the current level of spending is estimated at $3.2 billion to $11.1 billion.

While the committee quickly reached a consensus to send the bill to the full House for a vote, many Republicans said they were concerned about a requirement that anyone working on a project funded by the bill be paid at least the prevailing local wage. The requirement would apply the 78-year-old labor law known as the Davis-Bacon Act.

Calling it an "antiquated barrier to job creation," Rep. Connie Mack, a Republican from Florida, said the requirement would force employers to cover higher labor costs and many might opt to hire fewer people. But the committee's Democratic Chairman James Oberstar of Minnesota said the requirement would simply result in employers paying the average of local wages, which could be as low as $7 per hour.

Republican committee members said they would raise the issue again when the full House debates the bill.

The Senate will have to approve the bill once the House does. Currently, there is no corresponding legislation in the Senate.

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