Below is the transcript of the full testimony Mayor Jim Suttle gave to the House Transportation and Infrastructure Committee’s Water Resources Subcommittee.
December 14, 2011
My name is Jim Suttle, I’ve been the Mayor of Omaha since 2009. I also served as Vice Chair of the Board and Executive Vice President for HDR Engineering, Inc, Public Works Director for Omaha, and I am, by profession, an engineer.
I am testifying on behalf of The U.S. Conference of Mayors where I serve as an active member on the Mayors Water Council and have been part of the discussions that led to EPA’s Integrated Planning Memorandum.
This background gives me a unique perspective to comment on the matter before this subcommittee today and I would like to thank the Chairman and this committee for inviting me.
I am here today to tell you why the Mayors of this nation are concerned about the rising costs of water and wastewater infrastructure, what we hope EPA’s memo will address, and the fact that we need Congressional oversight to ensure that this process works.
We need true partners with EPA and Congress to ensure that this plan achieves what the Mayors have asked for – a flexible and cost-efficient way to achieve Clean Water Goals in a reasonable and pragmatic matter.
Background
Mayors became concerned with the overwhelming costs that were being implemented with water and wastewater infrastructure with a particular concern regarding Combined and Sanitary Sewer Overflow consent decrees. The Mayors had grave concerns that the enforcement actions were overly costly as well as overly prescriptive.
The Conference of Mayors submitted recommendations to EPA on how using the flexibility currently available in the Clean Water Act could provide some relief to cities without compromising water quality standards.
EPA has responded to those concerns with two memos – one on green infrastructure and the other — the Integrated Planning Memo.
The Conference applauds and appreciates EPA’s actions. EPA’s Memo is, from USCM’s perspective, a landmark departure from EPA’s "normal" approach. It has great potential, and should be seen as a three-way partnership between local government, state government and the EPA, all of whom can work together to make it work as intended.
Right now it is a statement of policy intention, and will only provide the requested flexibility if EPA carefully develops and adopts the right policy implementation framework. Then, it must be tested in the field.
Congress can play an important oversight role by following this policy approach as it unfolds. If it turns out that we cannot accomplish this goal administratively, we will request that Congress to act legislatively. But a legislative remedy would be premature at this time.
50 PERCENT GRANT FUNDING FROM THE FEDERAL GOVERNMENT
Local governments across the nation are spending more money than we are raising in revenues. I call your attention to the Table in the written testimony.
Long term debt rose over 80 percent between 2000 and 2009, and in 2009, long term debt was $1.6 trillion.
In 2009 alone, local government spent $103 billion on water wastewater while federal financial assistance in the form of the SRF programs was slightly over $2 billion.
It is painfully clear local government cannot afford to make all of the investments it wants for clean water objectives, nor all of the mandates the EPA wants it to invest in.
That is why the Conference of Mayors adopted policy to urge Congress to provide up to 50 percent of the capital necessary to meet requirements under the Clean Water Act, including CSO/SSO compliance.
Grants are sorely needed, and if Congress cannot help the cities in this way there should be every effort made by the EPA to lessen the cost burden of federal mandates by exercising the flexibility allowed by the Clean Water Act. Below are a few examples -
AFFORDABILITY
Aside from recent exceptions where EPA has been more flexible, the trend is the 4-2-20 model: 4 overflows or less in a year; 2 percent of Median Household Income (MHI) as a target for local spending on a long term control plan (LTCP); and, 20 years or less as a compliance schedule timeframe.
This approach locks-in local government to an overly costly, overly prescriptive and overlyrestrictive plans. There is no room, under this approach, for innovation and/or cost efficiencies.
All public revenues come from the same ratepayer’s pockets whether they are households or businesses. Adding unnecessary rate increases are not an option.
Mayors are concerned about the overall burden on those people and businesses, and as rates increase, they pose a greater burden.
Some important financial considerations:
a) Rates have a disproportionate impact on households, particularly low and medium-income households.
A household with a $25,000 annual income that pays $1,000 a year for water and sewer bills allocates 4 percent of that income.
A $250 increase in rates raises household spending to 5 percent of income.
A $500 a year increase in rates raises household spending to 6 percent.
EPA and Congress should no longer ignore the regressive financial impacts caused by unfunded mandates on low and moderate income households.
b) Businesses and other organizations are often significant ratepayers because they are large users of municipal wastewater services.
For businesses, wastewater is a variable cost of doing business.
History has demonstrated that industry is footloose, and will leave a community to seek favorable water and sewer rates.
If one of these ratepayers flee, local government must reapportion rates accordingly. This means that businesses that remain as well as households pay a larger share.
This in turn can cause more businesses to flee and for it to be less desirable place for people to live. It can also result in a greater cost share allocation to households.
GREEN INFRASTRUCTURE
The Conference of Mayors assembled experts on green infrastructure to review its potential to achieve water quality standards at a lower cost than gray infrastructure and provided that information to EPA.
To their credit, EPA issued guidance to its Regional Offices to promote the use of green infrastructure. We thank EPA for taking this step and look forward to working with them to expand this policy.
NEW TECHNOLOGY
The trend in CSO/SSO consent agreements has resulted almost predominantly in gray infrastructure- a solution that is neither imaginative nor cost-efficient.
Locking into a gray infrastructure solution is very expensive, and once you do, there is no incentive to consider employing innovative technology that might be better and cheaper, or that might have a lower energy-carbon emission.
The integrated permitting approach hopefully will provide flexibility by allowing adjustments to the plan to take advantage of green infrastructure and new technological advances.
Achieving water quality goals is better accomplished through the permitting process rather than enforcement via consent decrees.
In an Appendix to my testimony, you will find a list of local governments within your states who are subject to EPA’s enforcement strategy related just to CSOs. Unfortunately, we do not have a reliable list of SSO enforcements.
Every morning mayors and local government officials wake up as “criminals” by definition of EPA’s enforcement strategy.
It doesn’t matter if the mayor was elected 10 years ago or took office yesterday, they are, by definition “criminals” because their wastewater systems have sewer overflows, primarily as a result of a “natural act” – a significant rainstorm.
The chosen enforcement mechanism is an extraordinary legal remedy usually reserved for the most intractable cases of egregious violations of the Clean Water Act. But EPA has set it as the default regulatory mechanism.
Using this as the default option sends the message via the mass media to our citizens that mayors are not trustworthy, and that they condone water pollution.
I can think of no other federal administrative policy that has done so much to damage the intergovernmental partnership between federal and local elected officials and it should be ended immediately.
EPA can accomplish the same water quality goals through the permitting process, and by helping states and local government develop watershed water quality plans to protect this precious resource.
What Congress Can Do
As I mentioned earlier, the Integrated Planning policy still needs to be developed by the Agency and implemented in the field. If this approach does not create a path to help cities allocate limited resources for the right environmental outcome – then, it will have accomplished nothing.
We need Congress to provide oversight and to remember that EPA has this authority because of the way the Clean Water Act was written. We need a paradigm shift where together – local, state, and the federal officials exercise practical leadership and work together to determine what our environmental and spending priorities should be.
We owe our constituents with the most science-based, cost-efficient methods to provide them with a safe and clean environment that is economically sustainable.
The Conference of Mayors is working on a set of recommendations to implement the Integrated Planning Policy. The Conference plans to provide these recommendations to the EPA in the near future, and they would like to send them to the subcommittee at that time. Of particular note is that we would like Drinking Water Provisions to be included in an Integrated Plan, if a local government wants to include it.
Thank you again for this opportunity to address you.
