News | April 26, 2013

Private Activity Bonds (PABs) The Way To Fund Municipal Water Infrastructure Projects

By Bill King, Water Online

Representative Bill Pascrell, Jr. (D-NJ) is urging the nation’s water and wastewater industry to “track down their congressmen” and demand bipartisan support behind his measure to fund critical water infrastructure projects through private activity bonds (PABs). “Voters are not going to the polls to elect congressmen who want to spend tax dollars on fixing pipes,” Pascrell said during his keynote address at the Water and Wastewater Equipment Manufacturers Association’s (WWEMA) 40th Washington Forum on Wednesday, April 24, 2013.

In comparison to gun control, immigration, and the debate over paying down the national debt, the nation’s aging water infrastructure is not a topic that garners much attention. However, the ninth-term congressman made an impassioned case to an audience of water and wastewater equipment manufacturers that it needs to be. “One quarter of the nation’s treated water is lost due to leaks,” Pascrell pointed out. “Countries go to war over access to water!”

Citing a 2002 U.S. EPA study on a $500-billion water infrastructure funding gap over the next 20 years, Pascrell asked the audience, “Where are we going to get that kind of money when trying in earnest to pay down our debt?” Pascrell is urging the industry to get behind his coming infrastructure bill after his earlier Sustainable Water Infrastructure Investment Act (SWIIA) failed to come out of appropriations. Pascrell’s proposal hinges on removing state volume caps on private activity bonds (PABs) for water and wastewater financing.

PAB issuance would be one of the fastest forms of federal assistance when applied to water and wastewater projects, with only 90 to 120 days needed to complete the process — from approval to sale — and get Americans to work. Referencing a Clean Water Council report, Pascrell stressed that for every $1 billion invested, 28,500 jobs would be created per year. “This is not just a public health issue,” said Pascrell, “This is an economic issue.” Pascrell cited a U.S. Conference of Mayors report that calculated that for every $1 spent on infrastructure, $8.97 is added to the local economy.

Pascrell concluded on a note of optimism. For the first time since 2009, the President included water infrastructure funding in his budget and State of the Union address.