Infrastructure Financing

AWWA to Congress: ‘Free WIFIA’

AWWA is asking the US Congress to increase the effectiveness of the Water Infrastructure Finance and Innovation Act – known as WIFIA – by repealing a ban on the use of tax-exempt bonds in WIFIA-funded projects.

Enacted in 2014 as part of the Water Resources and Reform Development Act, WIFIA provides low-interest federal loans for up to 49% of large drinking water, wastewater and water reuse projects. However, as written, the law prohibits tax-exempt bonds from funding the remaining 51%, taking away the most cost-effective tool for communities that seek WIFIA loans.

During deliberations over WIFIA, the Joint Committee on Taxation scored WIFIA as inducing the issuance of additional tax-exempt debt and thus generating a small tax expenditure requiring a revenue offset. At the JCT’s suggestion, House and Senate conferees included the prohibition on combining tax-exempt bonds with WIFIA as the required offset. There is no infrastructure policy supporting this prohibition; it was included to address a tax score when no revenue offset could be identified.

If the ban were repealed, utilities would likely use lower-cost tax-exempt debt for the non-WIFIA share of project costs, lowering the overall cost of using the WIFIA program. As a result, WIFIA would be a cost-effective option for the much broader range of utilities it was intended to serve.

Free WIFIA button

To raise awareness of the issue in Congress, AWWA in March 2015 began a “Free WIFIA” campaign, which urges representatives and senators to let WIFIA do its important work unencumbered by the tax-exempt financing restriction. A full-page ad appeared in the March 18 edition of Politico, which is widely read by members of Congress, the same day that AWWA Water Matters! Fly-In delegates meet with their Representatives and Senators. Fly-In delegates will wear Free WIFIA buttons to their Capitol Hill visits. AWWA is also sharing messages through social media under the #freeWIFIA hashtag.

Water Matters! Fly In delegates also called on Congress to support full funding for WIFIA and for drinking water and wastewater state revolving loan fund programs, and to protect the tax-exempt status of municipal bonds.

Questions? Please contact Greg Kail, 303.734.3410, or Deirdre Mueller, 303.347.6140, in the AWWA Communications Department.

AWWA Buried No Longer Report

Buried No Longer Report

To get more realistic data on the scope of the US water infrastructure investment needs, in 2011 AWWA commissioned an important new study that produced the ground-breaking report, "Buried No Longer: Confronting America's Water Infrastructure Challenge" (PDF, 2.3MB). It methodically analyzes a variety of data and finds that the nation must invest $1 trillion over the coming 25 years if we are to maintain our current level of drinking water service. Other key findings include:

  • Household water bills will go up.The size of the increase varies with community and is influenced by existing local rate structures, methods of finance, etc.
  • There are important regional differences because of the different patterns of population growth and infrastructure investment over the history of the United States.
  • Important differences exist based on system size. Small communities in particular may find steeper challenges ahead.
  • Postponing water infrastructure investment only makes the problem worse when the bill inevitably comes due.

Watch the Buried No Longer video