Subcommittee on Interior, Environment, and Related Agencies

FY 2008 Appropriations for the Environmental Protection Agency

March 21, 2007

The Upper Mississippi River Basin Association (UMRBA) is the organization created in 1981 by the Governors of Illinois, Iowa, Minnesota, Missouri, and Wisconsin to serve as a forum for coordinating the five states’ river-related programs and policies and for collaborating with federal agencies on regional water resource issues. As such, the UMRBA has an interest in the budget for the water programs of the U.S. Environmental Protection Agency (EPA), including: State Water Pollution Control Grants, the Clean Water State Revolving Fund, State Nonpoint Source Grants, the Hypoxia Action Plan, and the Environmental Monitoring and Assessment Program. The UMRBA states are also concerned that the EPA has not adequately addressed the need for coordinated interstate implementation of the Clean Water Act on the Upper Mississippi River, and are therefore requesting that specific funding be directed to such an effort.

State Water Pollution Control Grants (Section 106)

Under Section 106 of the Clean Water Act, federal funds are allocated to be used in combination with the states’ matching dollars to support core state water quality programs. These core programs include water quality assessment and monitoring, water quality planning and standard setting, total maximum daily load (TMDL) development, point source permitting, training, and public information, as well as the implementation of rules governing concentrated animal feeding operations (CAFOs). Adequate funds are particularly critical to supporting the states’ development and implementation of TMDLs, which have the potential to overwhelm state agency resources that are already strained.

The Administration’s proposal for funding Section 106 State Water Pollution Control Grants in FY 08 is essentially the same as its proposed FY 07 level ($221.7 million). While this amount is 2.5 percent greater than the FY 06 enacted funding level of $216.2 million, it is still slightly below the FY 05 funding level of $222.4 million. Additionally, the UMRBA states have experienced a small, but consistent, decline in their allocation of Section 106 funding in recent years, from $21.5 million in FY 04 to $21.3 million in FY 07.

The UMRBA states remain concerned with the adequacy of funding in the baseline Section 106 program, which has remained largely static in recent years. UMRBA states are concerned that Section 106 funding will not be sufficient to effectively maintain core Clean Water Act programs and will not reverse the erosion of resources being provided to the Upper Mississippi River states. Thus, the UMRBA recommends that Congress provide $300 million for Section 106 grants, in accordance with the FY 08 authorized funding level in H.R. 720.

Clean Water State Revolving Funds

The Clean Water State Revolving Fund (CWSRF) program is widely acknowledged as having been pivotal in improving the nation’s water quality by addressing wastewater infrastructure needs. However, the President’s proposed FY 08 budget continues a trend of under-funding this critical infrastructure program. The UMRBA states are deeply concerned with the Administration’s continued lack of support for the CWSRF.

The President’s proposed CWSRF budget for FY 08 is $687.6 million, essentially the same as the proposed FY 07 budget. However, the proposed FY 08 level is down 22.5 percent from the FY 06 enacted level of $886.7 million, and represents a drop of nearly 50 percent from the $1.34 billion provided in FY 04. The five UMRBA states have experienced a reduction in CWSRF funding in excess of 50 percent over the same time period, receiving a total of $79.7 million in FY 07, down from $176.6 million in FY 04.

EPA’s own estimates show multi-billion dollar annual funding gaps for clean water and drinking water infrastructure over the next 20 years. The UMRBA states acknowledge that federal financial assistance is not the sole solution to this problem, but the appropriate response to this daunting challenge is most certainly not to further reduce federal support for this program. In order to best address the identified and continuing needs for clean water infrastructure improvements, the UMRBA recommends that Congress increase CWSRF FY 08 appropriations to $2.0 billion, consistent with the authorization in H.R. 720, recently passed by the House.

State Nonpoint Source Grants (Section 319)

Nonpoint sources are one of the major causes of water pollution in the Upper Mississippi River Basin, which drains the nation’s agricultural heartland. The Administration has requested $194 million for the Section 319 state nonpoint source grant program, equivalent to its FY 07 proposal, a 5 percent decrease from the FY 06 appropriation of $204 million, and an 18 percent overall decrease since FY 04.

The prospect of a sustained decline in Section 319 funding is particularly troubling to the UMRBA. For each year from FY 01 to FY 04, the five states in the Upper Mississippi River Basin were allocated a total of $34.0 million in nonpoint source grants. The proposed FY 08 funding level for Section 319 grants would result in $27.5 million for the UMRBA states, a reduction of 19 percent from the FY 01 to FY 04 period.

Increased resources for the USDA’s agricultural conservation programs have previously been cited as justification for decreases in Section 319 funding. However, the USDA programs do not have water quality improvement as their primary purpose and do not include a monitoring component to measure efficacy. Thus, while the UMRBA encourages coordination with USDA conservation programs, it continues to be essential to appropriately fund the Section 319 program as well. Without adequate funding, Section 319-supported programs cannot work in tandem with the USDA’s conservation programs, as originally envisioned, and certainly cannot address other pressing nonpoint source needs unrelated to agriculture, such as urban runoff and degraded urban streams and lakes.

The UMRBA states urge Congress to restore funding for state nonpoint source grants to the FY 04 level of $237 million, at minimum, recognizing that continued progress in addressing nonpoint pollution will require significantly increased resources.

Hypoxia Action Plan

The UMRBA is disappointed that the Administration’s FY 08 budget proposal does not include the resources needed to address recommendations in the Hypoxia Action Plan, submitted by the Mississippi River/Gulf of Mexico Watershed Nutrient Task Force in January 2001. The states in the Upper Mississippi River Basin have consistently stated that reductions in nutrient inputs to the Gulf of Mexico and monitoring to evaluate the effectiveness of these efforts will only be possible if the federal government provides significant new budgetary resources.

While the UMRBA states support the President’s FY 08 funding proposal for the Gulf of Mexico Program Office (a total of $4.5 million), this effort does not supply the major resources needed for Upper Mississippi River efforts. Moreover, Targeted Watershed Grants, which in past years have supported some hypoxia-related efforts, have been proposed for elimination in the FY 08 budget. The UMRBA states are deeply concerned about terminating this successful and well-received program.

While the states continue to support the goals and strategies set forth in the Action Plan, little progress will be made to reduce the Gulf hypoxic zone and improve water quality conditions throughout the basin without a major federal financial commitment. The states of the Midwest heartland are being left to work largely through their existing programs, with limited resources, to reduce nutrient loading to the Gulf of Mexico. This approach is simply not adequate to make progress on a problem with the complexity and spatial scope of Gulf hypoxia.

Environmental Monitoring and Assessment Program (EMAP)

Within EPA’s Human Health and Ecosystems Research program, the President has proposed a $5.8 million cut to the Environmental Monitoring and Assessment Program (EMAP) in FY 08. A portion of the EMAP program has been dedicated to Great River Ecosystems (EMAP-GRE), including the Mississippi, Missouri, and Ohio Rivers. EMAP-GRE has worked to develop improved science and practical tools that states can use to assess the ecological conditions of these Great River ecosystems. The proposed cuts in the EMAP budget will likely result in the reduction or early termination of important collaborative efforts currently taking place between states and EPA on the Upper Mississippi River. Additionally, the proposed EMAP budget reduction would likely prevent EMAP-GRE from being able to conduct work in the lower Mississippi River and would impair the ability to share knowledge gained on the upper River with states on the lower River. While the UMRBA recognizes that EMAP was conceived as a “technology transfer” effort rather than an ongoing monitoring program, premature reductions in funding will significantly impair knowledge transfer and undercut states seeking to implement statistically valid approaches to monitoring and assessment. Thus, the UMRBA states urge Congress to reject the proposed cut to EMAP’s budget and restore EMAP funding in order to allow the program to complete its important technology transfer mission.

Coordinated Implementation of the Clean Water Act on the Upper Mississippi River

Under the Clean Water Act, each state is independently responsible for setting water quality standards, conducting water quality monitoring, and determining if its waters are “impaired.” While this framework is appropriate and successful for the waters contained within the boundaries of a state, it can be problematic for large border waters, such as the Mississippi River. On the Mississippi River, differences in states’ approaches can result in an unequal and uncertain regulatory environment for economic investment, public confusion about the quality of the river, inefficient allocation of resources, and vulnerability to legal challenge.

The Mississippi River is at a disadvantage compared to other major interstate waterbodies in the United States. There is no program designed exclusively to address the unique water quality problems of this greatest of all American rivers. While the states have worked diligently to protect the quality of the river, they must take funds from their budgets allocated to all their rivers, lakes, and streams to pursue work on the Mississippi River. The states currently dedicate approximately $600,000 annually to Upper Mississippi River water quality efforts from their overall water quality budget. In contrast, other nationally significant waterbodies receive substantial dedicated federal funds. Examples include:

§ The Great Lakes EPA water quality program is funded at approximately $20 million per year.

§ The Chesapeake Bay Program is slated to receive over $28 million in EPA’s FY 08 budget.

§ The Ohio, Delaware, Susquehanna, and Potomac Rivers all have interstate water quality agencies that receive funding under Section 106 of the Clean Water Act, in addition to the funds received by their States. Annual funding for each interstate commission ranges between $500,000 and $1.2 million.

In order to address the challenges of coordinated Clean Water Act program implementation, the UMRBA states propose the creation of a unified water quality monitoring, assessment, and standards program for the Upper Mississippi River, to be administered by the states of Illinois, Iowa, Minnesota, Missouri, and Wisconsin, through the UMRBA. To support this initiative, the UMRBA states request that Congress provide annual funding to the UMRBA, through the EPA budget, beginning at $200,000 in FY 08 and increasing, by FY 12, to a level commensurate with the funding provided to other interstate river commissions. This federal funding will be used in conjunction with funding contributions from the Basin states to support this coordinated program. Importantly, the UMRBA states believe that this dedicated funding for the Upper Mississippi River must be in addition to the allocation they currently receive under Section 106 of the Clean Water Act, and not be taken from their existing Section 106 allotments.

Upper Mississippi River Basin Association

415 Hamm Building, 408 St. Peter Street

St. Paul, Minnesota 55102

Phone: 651-224-2880