Federal cuts could hurt local programs
James Rufus Koren
Redlands Daily Facts
04/12/2011
Part of the budget deal that prevented a federal government shutdown late last week is a cut that officials say could tie up or raise the cost of local water projects.
Details of the budget agreement released Tuesday show a $997million cut to two funds that provide grants and low-interest loans to water agencies to help fund the construction of water treatment facilities and other projects.
"That does cause us some concern," said Thomas Love, general manager of the Inland Empire Utility Agency, a wastewater treatment agency that serves western San Bernardino County between Chino Hills and Fontana. "Depending on how long the federal budget crisis and their reduction of this type of funding lasts, it may impact us in the future."
Love and other area water district officials said many San Bernardino County projects have been funded in part with grants and loans from the Clean Water State Revolving Fund and the Drinking Water State Revolving Fund.
In the 2010 budget, those two funds had a combined budget of about $3.5billion. The proposed $997million cut, which is part of the stopgap spending plan scheduled for a vote in Congress today or Thursday, would amount to a 28.5percent reduction from 2010.
"The potential federal action doesn't eliminate it, but it could significantly reduce the available funding," Love said.
It's hard to know what that will mean for local agencies. Officials with the Environmental Protection Agencies, which administers the funds, said they could not comment on the likely impacts of the cut until after the budget deal has been approved. Officials with the California Department of Public Health, which distributes the federal funds, had no comment.
Officials at several local agencies say they are hoping for money from those funds, either now or in the near future.
Robert Martin, general manager of the Highland-based East Valley Water District, said a loss of State Revolving Fund money wouldn't stop projects from going forward, but it would make them more expensive.
"We would have to go out and finance the construction on the open market, selling bonds," he said. "Though one part of the award was pure grant money the other portion is low interest loans. It's very, very inexpensive money. We're saving a tremendous amount of money by not having to finance these on the open market."
Logan Olds, general manager of the Victor Valley Wastewater Reclamation Authority, said many water agencies can't afford or qualify for bonds, leaving the State Revolving Fund as "one of the last options for agencies to pay for their projects at a reasonable cost."
Two small water companies in the San Bernardino-Highland area are counting on money from the Drinking Water State Revolving Fund to help overhaul their infrastructure so they can merge with a larger water district.
Baseline Gardens Mutual Water Co., which serves about 2,000 people in an unincorporated area south of Pacific High School, had to stop using its own water supply last summer after the company found contamination in its wells.
