Bipartisan Infrastructure Passes Senate, but Stalls in the House

After several fits and starts, a bipartisan bill on U.S. infrastructure advanced in the U.S. Senate. On August 10, 2021, the U.S. Senate passed its version of a long-awaited infrastructure package with a 69-30 vote. The Infrastructure Investment & Jobs Act provides approximately $1.2 trillion of traditional infrastructure funding. The vote was primarily along party lines with 30 Republican Senators opposing the bill’s passage. Not only is the bill large in term of funding level, its text is also large at 2,700-plus-pages. Passage of this bill represents the culmination of several months of negotiations between the White House and a group of bipartisan Senators committed to passing major infrastructure funding legislation. In addition to expanding domestic preference requirements, the legislation invests approximately $55 billion in clean water. More specifically, contained within the bill is the Drinking Water and Wastewater Infrastructure Act, which authorizes the following:

 

• Both the Drinking Water and Clean Water State Revolving Funds are funded in the following amounts by year: $2.4 billion for FY 2022; $2.7 billion for FY 2023; $3 billion for FY 2024; and $3.2 billion for each of FY 2025 and FY 2026.
• Lead service line replacement activities are substantially funded with $15 billion, $3 billion for each of FY 22-26.
• $4 billion to address emerging contaminants with a focus that includes PFAS that is equally distributed over FY22-26.
• The Water Infrastructure Finance and Innovation Act Program will receive $250 million annually for FY 22-26 with less stringent requirements that reduce the number of opinion letters from rating agencies from two to one.

 

A copy of the bill can be found HERE. The bill appears to have lost momentum in the House partially due to other national priorities including the U.S. withdrawal from Afghanistan, the increase in national COVID-19 cases due to the Delta variant, and recent mixed economic news including sluggish growth in the August nonfarm payroll employment. It remains to be seen if the House can unite when it returns later this month to pass the bill and move it on to the President for signature. A lot will depend on whether the House accepts the Senate bill as transmitted or if they open it up for additional changes and amendments that will require more negotiations with the Senate.

 

In a related note, on August 23, 2021, the U.S. House of Representatives approved a $3.5 trillion budget blueprint that paves the way to address the so called ‘social’ infrastructure—significantly expanding the safety net for people and substantially expanding programs to address climate issues. House Speaker Nancy Pelosi (D-CA) is trying to tether passage of the Infrastructure Investment & Jobs Act to the social infrastructure package which has an even larger price tag of $3.5 trillion. She is facing challenges both within her own party and across-the-aisle with centrist Democrats growing more hesitant and vocal. Specifically, on September 2, 2021, in a Wall Street Journal Op-Ed piece, Senator Joe Manchin (D-WV) called for a ‘strategic pause’ in moving forward with the massive $3.5 trillion plan. He noted, “I, for one, won’t support a $3.5 trillion bill, or anywhere near that level of additional spending, without greater clarity about why Congress chooses to ignore the serious effects inflation and debt have on existing government programs.”

 

In the Senate, all Democrats along with two Independents plus Vice President Kamala Harris, who can break ties, must vote affirmatively to have the $3.5 billion legislation win passage, given the bill is now working under a process known as reconciliation, which is immune to the filibuster and as a result significantly lowers the bar in terms of the votes needed to secure passage. However, this isn’t necessarily carte blanche for the Democrats because something referred to as the “Byrd Rule” permits any Senator to object to any add-ons or amendments not related to the budget or reducing the U.S. deficit. In the U.S. House of Representatives, the margin is slightly more flexible, with up to three Democrats being able to oppose the package and have it pass (assuming all Republicans remain opposed to the package).

 

In prior Bulletin articles, member communications, and during a meeting of WWEMA’s Legislative and Regulatory Committee, WWEMA has worked to educate our members on the possible expansion of domestic content requirements of direct and indirect Federal procurement beyond the current American iron and steel requirements placed on the state revolving loan funds and WIFIA. This expansion would include “manufactured goods” and a component test of 55% for a product to be considered domestic should the current infrastructure package be enacted into law. More importantly, we are engaged in understanding how this will impact our members and the greater water industry and working to communicate those impacts to key policy makers and legislators. Specifically, we are dialoging both with EPA and the newly created Made in America Office within the Office of Management and Budget regarding the potential impact these requirements might have on the water industry costs, schedules, and technology selection.