>CONGRESSIONAL BUDGET FOR THE UNITED STATES GOVERNMENT FOR FISCAL YEAR 2007

(Senate - March 13, 2006)

Mr. CRAPO. Mr. President, I rise to engage the distinguished chairman in a colloquy.

   Mr. GREGG. I yield to the Senator.

   Mr. CRAPO. I wish to express my appreciation for your efforts to put together a well-crafted fiscal year 2007 budget resolution that balances the need for critical Government programs while taking a strong stand against our budget deficit.

   As the committee works to address these critical needs, one area of the administration's request in particular needs special mention--the proposal to reduce funding for the Clean Water State Revolving Fund, CWSRF, and the Drinking Water State Revolving Fun d, DWSRF. Although the administration's budget submission makes a number of difficult choices, the recommendation to reduce funding to the CWSRF and the DWSRF represents a tremendous hardship for communities throughout the country.

   Recent studies show that our Nation's water and wastewater infrastructure needs severely exceed the availability of resources at the local and State level to meet them. So many towns and cities across our country have exhausted their abilities to raise utility rates and issue bonds to pay for needed improvements. At the same time, increasing Federal water quality and drinking water standards force utility managers to upgrade systems or fall into noncompliance.

   No community or customer wants to be served by a failing water or wastewater facility, but the Federal Government's commitment to addressing these regulatory mandates must be mat ed with its assistance. Without this commitment, communities can be left with nowhere to turn for help. The Congressional Budget Office estimated in 2002 that th e United States has between $132 billion and $388 billion in clean water infrastructure needs alone over the ne xt 20 years and the spending gap over that time will reach $70 to 360 billion. Similar figures affect the Nation's drinking water infrastructure.

   Idaho, a small State by population and infrastructure needs, still only receives about $15 million annually, but its aggregate water and wastewater needs over the next 20 years will approach $1 billion by some estimates. For instance, the rural city of Castleford , ID, has become out of compliance with the EPA's arsenic standard for drinking water. In order to conform with the rule, the town, with a population of less than 200, will have to expend more than its entire annual operating budget to update the water infrastructure system.

   The principal means for assisting utilities are the SRFs, which provide a loan pool for State agencies to work with distressed communities. The SRF assistance help finance infrastructure projects at the local level, and those communities in turn repay those loans so that the State might aid other communities in need.
   That is why I believe it is so problematic to see a continuing decline in funding for the CWSRF and DWSRF. As recently a s 2 years ago, funding was $1.35 billion and $850 million, respectively. Unfortunately, budget pressure has forced the CWSRF down to $900 million in the current fiscal yea r, and the President has proposed to reduce that to $688 million for the next year. While the DWSRF is proposed at only an $8 million reduction, a fateful and disturbing trend is developing.

   As the past chairman of the Environment and Public Works Subcommittee on Fisheries, Wildlife, and Water, I led efforts in two successive Congresses to update and increase the authorization for the CWSRF and DWSRF. Although those legislative initiatives never made it to the Senate floor, I remain committed to helping communities in Idaho and throughout the country address their water and wastewater needs.

   During the debate on this budget resolution in the Budget Committee, an amendment was offered to condemn the President's call for reductions in those important accounts. I opposed that amendment because I want to focus effort where it counts, by working with my distinguished chairman and the Appropriations Committee to restore funding for the two SRFs to the best of our abilities.

   Mr. Chairman, I ask that you join me in working through the balance of the budget re solution process, as well as during your service on the Appropriations Committee, to help restore these vital funds.

   Mr. GREGG. Thank you, Senator Crapo. I agree with your comments about the importance of these resources, and I applaud your leadership in this area. While the President's request for these accounts is lower than many would like, I believe that during the appropriations process, Congress will try to remedy this problem. As you know, historically, the President tends to request lower funding levels for these accounts, and Congress usually pluses them up through the appropriations process, often quite significantly. For example, in 2004, 2005, and 2006, Congress provided considerably more for the Clean Water SRF Program than the President requested, + 492 million, +291 million, and +$157 million, respectively. As Congress works to finalize the fiscal year 2007 budget resolution, I will continue to work with you on these issues.

   Additionally, in my role as a member of the Appropriations Committee, I will certainly be cognizant of the funding needs for SRF Programs.

   Mr. CRAPO. Thank you, Mr. Chairman.