Energy Bill Passes Without MTBE Liability Protection Clause

In August, President George W. Bush signed a broad energy bill, which to the satisfaction of civic and water groups, did not contain legal protections for makers of the gasoline additive methyl tertiary butyl ether (MTBE).

Sep 1st, 2005

In August, President George W. Bush signed a broad energy bill, which to the satisfaction of civic and water groups, did not contain legal protections for makers of the gasoline additive methyl tertiary butyl ether (MTBE).

The bill, 4½ years in the making, would encourage more production of all forms of energy, along with energy efficiency and conservation. It passed the House of Representatives 275-156 and the Senate 74-26.

Congress did not allow companies making MTBE the legal protections they had sought from groundwater pollution lawsuits. But it did allow MTBE product liability lawsuits to be shifted from state to US courts.

The American Water Works Association (AWWA) said MTBE has contaminated the water supplies of communities in 36 states nationwide. It said the cost of removing contamination from community water supplies will be $25-85 billion.

AWWA said the Environmental Protection Agency (EPA) has classified MTBE as a potential human carcinogen and is considering upgrading it to a likely human carcinogen.

Congress rejected a proposal to create an $11.43 billion fund to clean up MTBE water contamination, with a third coming from the federal government, states, and MTBE manufacturers.

Jack Hoffbuhr, AWWA executive director, said, “The elimination of MTBE liability immunity from the energy bill is a tremendous victory for water utilities, local communities, and consumers. The resolve demonstrated by water professionals, municipal groups, safe water advocates and others should remind our elected leaders that the protection of our water supplies cannot be bargained away.”

The National League of Cities said without the “onerous” compromise, “Cities will continue to have the ability to recoup the clean-up costs directly from the polluters.”

EPA Funding

Congress has approved an Interior Appropriations bill for fiscal 2006 that slashed the Clean Water State Revolving Fund (SRF) by $440 million (33%), reducing it to $900 million compared with $1.34 billion two fiscal years ago.

The National Resources Defense Council (NRDC) said the reduction “will undermine a popular and effective program that is vital to helping communities keep their waterways clean.”

Nancy Stoner of NRDC said, “Public health and economic growth depend on clean water. Not only is federal clean water funding responsible for significant water quality improvements nationwide, but it also stimulates local economies and creates jobs. It makes no sense for Congress to target this crucial clean water loan fund for deep spending cuts.”

NRDC said the Clean Water SRF offers long-term, low-interest loans to state and local governments to help them meet federal water quality standards. Over the past 16 years this program has dispersed more than 14,200 loans -- totaling $47 billion -- to communities for rehabilitating aging sewer plants, minimizing raw sewage overflows and reducing stormwater runoff.

NRDC said the Clean Water SRF cut would have a ripple effect since every dollar in federal grants results in $2.2 dollars in total spending due to state and local matching funds and bond leveraging.

It said a congressional budget resolution passed earlier this year locks the cuts into place over the next five years. Thus, the $440 million reduction will lead to a total loss of $928 million (including $528 million due to lost state matching and leveraging) with a total loss over five years of $4.6 billion.

Water Funding Bill

Key senators on the Environment and Public Works Committee have introduced the “Water Infrastructure Financing Act” to provide $38 billion over five years for improvements to the nation’s aging water infrastructure.

The bill would increase funding for the Clean Water SRF to $20 billion and the Drinking Water SRF to $15 billion.

Committee Chairman James Inhofe (R-Okla.) said, “The federal government has imposed numerous expensive regulations on our cities and towns without providing sufficient funding to meet our obligations under the Unfunded Mandates Reform Act.”

Inhofe said, “The nation is on the verge of a crisis with its water and wastewater systems” and the legislation would bridge the funding gap to update aging infrastructure.

Sen. Jim Jeffords (I-Vt.), the ranking member of the committee, said, “This bill represents a new awareness on the part of the federal government that our nation’s water supply is becoming an increasingly precious resource.”

The legislation would establish two new cost-share grant programs, funded at $1.5 billion each, to support critical projects such as sewer overflow control, watershed protection, alternative sources, and groundwater mitigation.

It also has two new grant programs, at $125 million each, to help small rural wastewater and drinking water systems plan and develop infrastructure improvement projects.

A $200 million program would support research and demonstration of clean water and drinking water technologies and alternative management approaches. And a $50 million program would support projects to control water pollution from agricultural sources.

The bill would permit states to provide “additional subsidization” to “disadvantaged” communities, including offering no-interest loans and forgiving loan principal.

For both SRFs, the law would allow states to transfer up to a third of each year’s capitalization grant between the two funds. States could use up to 6% of their annual capitalization grants, instead of the current 4%, for administration.

Water Resource Development

In July, the House of Representatives passed a $10 billion Water Resources Development Act authorizing hundreds of U.S. Army Corps of Engineers projects related to water supplies, navigation, flood control, and environmental restoration.

The House bill, passed 406-14, included nearly $1 billion in projects to construct or rehabilitate drinking water, wastewater and stormwater infrastructure.

The Senate Environment and Public Works Committee approved a $17 billion bill in May but it won’t be debated on the floor until fall.

EPA CWA Budgeting Deemed Inadequate

The Government Accountability Office (GAO) has said EPA’s process for budgeting and allocating resources to meet its workload under the Clean Water Act (CWA) is inadequate.

According to the report, EPA and states are responsible for regulating 6,730 major facilities and 93,912 minor facilities under the CWA, including municipal wastewater treatment plans and industrial discharge control facilities.

GAO said EPA’s budgeting decisions are based on historical decisions, not current needs. EPA does not conduct periodic “bottom-up” assessments of the work that needs to be done, the distribution of the workload, or the resources needed to respond more effectively to changing needs and constrained resources.

It said EPA lacks complete or reliable information on its activities under the CWA -- and how that work is distributed organizationally and geographically -- which would help the agency allocate resources more effectively. Having this information will also help EPA plan its workforce needs and ensure that the right people with the right skills are in place to complete the work, the report said.

And the report said EPA is not providing information to Congress as required by law on how much it costs to implement the CWA.

GAO recommended that EPA identify what is driving the agency’s resource needs, ensure that relevant data are complete and reliable, and use the results in making its budgeting decisions.

Beach Reports

EPA and NRDC have issued conflicting reports on the state of the nation’s beaches.

EPA’s most recent data on beach closings and advisories show that only 4% of beach days were lost in 2004 due to advisories or closures triggered by monitoring for bacteria. Most of the closures were relatively brief. More than 2,700 closings were two days or less, and only 59 closings lasted more than 30 days.

EPA said the number of beaches monitored has more than tripled -- 3,574 in 2004, compared with 1,021 in 1997, the first year EPA began collecting beach-monitoring program data. EPA said 942 beaches, or 26%, had at least one advisory or closing during the 2004 season.

EPA attributed the improvements to greater state participation in the program and also to improved measurement and monitoring made possible by federal grant money. For the past five years, EPA has provided nearly $42 million in grants to 35 coastal and Great Lakes states and territories.

NRDC immediately issued a report that said beach closings due to hazardous bacterial contamination are on the rise.

The study counted nearly 20,000 closing and health advisory days across the country in 2004, the most since NRDC began its tracking beach pollution 15 years ago. It said improved monitoring “is now uncovering the true extent of the pollution problem.”

NRDC’s Stoner said, “Instead of closing our beaches, let’s clean up the water. Authorities have gotten better at finding the problems. Now they need to stop the pollution at its source by repairing and replacing leaky sewage and septic systems, and cleaning up contaminated runoff.”

NRDC said 85% of the closing and advisory days were prompted by dangerously high bacteria levels, indicating the presence of human or animal waste. The main culprits are improperly treated sewage and bacteria-contaminated stormwater runoff.

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