I 

112TH CONGRESS 

1ST SESSION H. R. 1189 

To amend the Federal Water Pollution Control Act to assist municipalities 

that would experience a significant hardship raising the revenue necessary 

to finance projects and activities for the construction of wastewater 

treatment works, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 17, 2011 

Mr. LATTA (for himself, Mr. MCKINLEY, and Mr. LATOURETTE) introduced 

the following bill; which was referred to the Committee on Transportation 

and Infrastructure 

A BILL 

To amend the Federal Water Pollution Control Act to assist 

municipalities that would experience a significant hardship raising the revenue necessary to finance projects 

and activities for the construction of wastewater treatment works, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Clean Water Afford5 ability Act of 2011’’. 


rfrederick on DSKD9S0YB1PROD with BILLS
2 

•HR 1189 IH

1 SEC. 2. CAPITALIZATION GRANT AGREEMENTS. 

2 Section 602(b) of the Federal Water Pollution Con3 trol Act (33 U.S.C. 1382(b)) is amended— 

4 (1) by striking ‘‘and’’ at the end of paragraph 

5 (9); 

6 (2) by striking the period at the end of para7 graph (10) and inserting ‘‘; and’’; and 

8 (3) by adding at the end the following: 

9 ‘‘(11) the State will use at least 15 percent of 

10 the amount of each capitalization grant received by 

11 the State under this title after September 30, 2012, 

12 to provide assistance to municipalities of fewer than 

13 10,000 individuals that meet the affordability cri14 teria established by the State under section 

15 603(i)(2) for activities included on the State’s pri16 ority list established under section 603(g), to the ex17 tent that there are sufficient applications for such 

18 assistance.’’. 

19 SEC. 3. WATER POLLUTION CONTROL REVOLVING LOAN 

20 FUNDS. 

21 (a) EXTENDED REPAYMENT PERIOD.—Section 

22 603(d)(1) of the Federal Water Pollution Control Act (33 

23 U.S.C. 1383(d)(1)) is amended— 

24 (1) in subparagraph (A) by striking ‘‘20 years’’ 

25 and inserting ‘‘the lesser of 30 years or the design 


rfrederick on DSKD9S0YB1PROD with BILLS
3 

•HR 1189 IH

1 life of the project to be financed with the proceeds 

2 of the loan’’; and 

3 (2) in subparagraph (B) by striking ‘‘not later 

4 than 20 years after project completion’’ and insert5 ing ‘‘upon the expiration of the term of the loan’’. 

6 (b) ADDITIONAL SUBSIDIZATION.—Section 603 of 

7 such Act (33 U.S.C. 1383) is amended by adding at the 

8 end the following: 

9 ‘‘(i) ADDITIONAL SUBSIDIZATION.— 

10 ‘‘(1) IN GENERAL.—In any case in which a 

11 State provides assistance to a municipality or inter12 municipal, interstate, or State agency under sub13 section (d), the State may provide additional sub14 sidization, including forgiveness of principal and 

15 negative interest loans to benefit a municipality 

16 that— 

17 ‘‘(A) meets the State’s affordability criteria 

18 established under paragraph (2); or 

19 ‘‘(B) does not meet the State’s afford20 ability criteria if the recipient— 

21 ‘‘(i) seeks additional subsidization to 

22 benefit individual ratepayers in the resi23 dential user rate class; 

24 ‘‘(ii) demonstrates to the State that 

25 such ratepayers will experience a signifiVerDate Mar 15 2010 02:12 Mar 23, 2011 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1189.IH H1189

rfrederick on DSKD9S0YB1PROD with BILLS
4 

•HR 1189 IH

1 cant hardship from the increase in rates 

2 necessary to finance the project or activity 

3 for which assistance is sought; and 

4 ‘‘(iii) ensures, as part of an assistance 

5 agreement between the State and the re6 cipient, that the additional subsidization 

7 provided under this paragraph is directed 

8 through a user charge rate system (or 

9 other appropriate method) to such rate10 payers. 

11 ‘‘(2) AFFORDABILITY CRITERIA.— 

12 ‘‘(A) ESTABLISHMENT.—On or before Sep13 tember 30, 2012, and after providing notice 

14 and an opportunity for public comment, a State 

15 shall establish affordability criteria to assist in 

16 identifying municipalities that would experience 

17 a significant hardship raising the revenue nec18 essary to finance a project or activity eligible 

19 for assistance under section 603(c)(1) if addi20 tional subsidization is not provided. Such cri21 teria shall be based on income data, population 

22 trends, and other data determined relevant by 

23 the State, including whether the project or ac24 tivity is to be carried out in an economically 

25 distressed area, as described in section 301 of 


rfrederick on DSKD9S0YB1PROD with BILLS
5 

•HR 1189 IH

1 the Public Works and Economic Development 

2 Act of 1965 (42 U.S.C. 3161). 

3 ‘‘(B) EXISTING CRITERIA.—If a State has 

4 previously established, after providing notice 

5 and an opportunity for public comment, afford6 ability criteria that meet the requirements of 

7 subparagraph (A), the State may use the cri8 teria for the purposes of this subsection. For 

9 purposes of this Act, any such criteria shall be 

10 treated as affordability criteria established 

11 under this paragraph. 

12 ‘‘(C) INFORMATION TO ASSIST STATES.— 

13 The Administrator may publish information to 

14 assist States in establishing affordability cri15 teria under subparagraph (A). 

16 ‘‘(3) LIMITATION.—The total amount of addi17 tional subsidization provided under this subsection 

18 by a State may not exceed 30 percent of the total 

19 amount of capitalization grants received by the State 

20 under this title in fiscal years beginning after Sep21 tember 30, 2012.’’. 

22 SEC. 4. UPDATING OF GUIDANCE. 

23 (a) DEFINITIONS.—In this section, the following defi24 nitions apply: 


rfrederick on DSKD9S0YB1PROD with BILLS
6 

•HR 1189 IH

1 (1) ADMINISTRATOR.—The term ‘‘Adminis2 trator’’ means the Administrator of the Environ3 mental Protection Agency. 

4 (2) AFFORDABILITY.—The term ‘‘affordability’’ 

5 means, with respect to payment of a utility bill, a 

6 measure of whether an individual customer or house7 hold can pay the bill without undue hardship or un8 reasonable sacrifice in the essential lifestyle or 

9 spending patterns of the individual or household, as 

10 determined by the Administrator. 

11 (3) FINANCIAL CAPABILITY.—The term ‘‘finan12 cial capability’’ means the financial capability of a 

13 community to make investments necessary to make 

14 water quality-related improvements, taking into con15 sideration the criteria described in subsection 

16 (b)(2)(A). 

17 (4) GUIDANCE.—The term ‘‘guidance’’ means 

18 the guidance published by the Administrator entitled 

19 ‘‘Combined Sewer Overflows—Guidance for Finan20 cial Capability Assessment and Schedule Develop21 ment’’ and dated February 1997, as applicable to 

22 combined sewer overflows and sanitary sewer over23 flows. 

24 (b) UPDATING.— 


rfrederick on DSKD9S0YB1PROD with BILLS
7 

•HR 1189 IH

1 (1) IN GENERAL.—Not later than one year 

2 after the date of enactment of this Act, the Adminis3 trator shall update the guidance to ensure that the 

4 evaluations by the Administrator of financial capa5 bility assessment and schedule development meet the 

6 criteria described in paragraph (2). 

7 (2) CRITERIA.—The criteria described in this 

8 paragraph are that, under the updated guidance— 

9 (A) in assessing the financial capability of 

10 a community— 

11 (i) greater emphasis should be placed 

12 on local economic conditions; 

13 (ii) for regional systems, consideration 

14 should be given to the economic conditions 

15 of political jurisdictions and significant de16 mographic groups within each region; 

17 (iii) prescriptive formulas for use in 

18 calculating financial capability and thresh19 olds for expenditure should not be consid20 ered to be the only indicator of the finan21 cial capability of a community; 

22 (iv) site-specific local conditions 

23 should be taken into consideration in ana24 lyzing financial capability; 


rfrederick on DSKD9S0YB1PROD with BILLS
8 

•HR 1189 IH

1 (v) a single measure of financial capa2 bility or affordability (such as median 

3 household income) should be viewed in the 

4 context of other economic measures, rather 

5 than as a threshold to be achieved; and 

6 (vi)(I) consideration should be given 

7 to the economic outlook of a community, 

8 including the potential impact of program 

9 requirements over time, in the development 

10 of implementation schedules; and 

11 (II) the assessment should take into 

12 consideration other essential community 

13 investments relating to water quality im14 provements; 

15 (B) with respect to the timing of imple16 mentation of water quality-related improve17 ments— 

18 (i) environmental improvement imple19 mentation schedules should be structured 

20 to mitigate the potential adverse impact on 

21 distressed populations resulting from the 

22 costs of the improvements; 

23 (ii) implementation schedules should 

24 reflect local community financial conditions 

25 and economic impacts; 


rfrederick on DSKD9S0YB1PROD with BILLS
9 

•HR 1189 IH

1 (iii) implementation schedules should 

2 allow permittees up to 30 years to imple3 ment water quality-related improvements 

4 in appropriate cases in which the cost of 

5 implementing the improvements places a 

6 high financial burden on the permittee; 

7 and 

8 (iv) existing implementation schedules 

9 should be modified in appropriate cases 

10 taking into consideration the criteria set 

11 forth in this subparagraph; 

12 (C) with respect to implementation— 

13 (i) a determination of local financial 

14 capability may be achieved through an 

15 evaluation of an array of factors the rel16 ative importance of which may vary across 

17 regions and localities; and 

18 (ii) an appropriate methodology 

19 should give consideration to such various 

20 factors as are appropriate to recognize the 

21 prevailing and projected economic concerns 

22 in a community; and 

23 (D) the residential indicator should be re24 vised to include— 


rfrederick on DSKD9S0YB1PROD with BILLS
10 

•HR 1189 IH

1 (i) a consideration of costs imposed 

2 upon ratepayers for essential utilities; 

3 (ii) increased consideration and quan4 tification of local community-imposed costs 

5 in regional systems; 

6 (iii) a mechanism to assess impacts on 

7 communities with disparate economic con8 ditions throughout the entire service area 

9 of a utility; 

10 (iv) a consideration of the industrial 

11 and population trends of a community; 

12 (v) recognition that— 

13 (I) the median household income 

14 of a service area reflects a numerical 

15 median rather than the distribution of 

16 incomes within the service area; and 

17 (II) more representative methods 

18 of determining affordability, such as 

19 shelter costs, essential utility pay20 ments, State affordability criteria, and 

21 State and local tax efforts, should be 

22 considered; 

23 (vi) a consideration of low-income 

24 ratepayer percentages; and 


rfrederick on DSKD9S0YB1PROD with BILLS
11 

•HR 1189 IH

1 (vii) impacts relating to program de2 livery, such as water quality infrastructure 

3 market saturation and program manage4 ment. 

5 (3) IMPLEMENTATION.—The updated guidance 

6 should indicate that, in a case in which a previously 

7 approved long-term control plan or associated en8 forceable agreement does not prohibit modification 

9 of the plan or terms of the agreement (including fi10 nancial capability considerations), and all parties are 

11 in agreement that a change is needed or that the 

12 plan or agreement does not prohibit reopening to ad13 dress changes in the economic or financial status of 

14 the community since the effective date of the plan or 

15 agreement, reconsideration and modification of fi16 nancial capability determinations and implementa17 tion schedules based on the criteria described in 

18 paragraph (2) is appropriate. 

19 (c) PUBLICATION AND SUBMISSION.—Upon comple20 tion of the updating of guidance under subsection (b), the 

21 Administrator shall publish in the Federal Register and 

22 submit to the Committee on Environment and Public 

23 Works of the Senate and the Committee on TransporVerDate Mar 15 2010 02:12 Mar 23, 2011 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H1189.IH H1189

rfrederick on DSKD9S0YB1PROD with BILLS
12 

•HR 1189 IH

1 tation and Infrastructure of the House of Representatives 

2 the updated guidance. 

Æ 


rfrederick on DSKD9S0YB1PROD with BILLS