Order Code IB10101
Issue Brief for Congress
Received through the CRS Web
The Environmental Protection Agency’s
FY2003 Budget
Updated September 5, 2002
Martin R. Lee
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

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CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
Homeland Security
EPA’s Budget by Appropriations Accounts
Science and Technology
Environmental Programs and Management
Office of Inspector General
Buildings and Facilities
Oil Spill Response
Superfund
Leaking Underground Storage Tanks
State and Tribal Assistance Programs
LEGISLATION
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
CHRONOLOGY

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The Environmental Protection Agency’s FY2003 Budget
SUMMARY
For FY2003, the President requests $7.7
grams and Management account, the
billion in budget authority for the Environ-
requested level is $2,047.7 million. The Sen-
mental Protection Agency (EPA), $458.8
ate action provides $2,140.5 million. The $1.3
million (or 5.6%) less than the total FY2002
billion requested, and approved by the Senate
appropriation of $8.2 billion, which included
action, to clean up toxic waste sites under
a $175 million terrorism supplemental in P.L.
Superfund is about the same as the current
107-117, Div. B. The Administration would
year level. There is some concern over the
not continue funding about $500 million for
proposed decline in Superfund activities
activities earmarked in the FY2002
under this request, and that the taxpayers
appropriation, and proposes provisions shift-
would now pay for the majority of the appro-
ing more enforcement responsibilities to the
priation, as the industry-supported trust fund
states. In FY2002, $188.1 million was allo-
balance declines.
cated for EPA’s Homeland Security efforts;
for FY2003, the President seeks an allocation
How to fund state and local wastewater
of $133.4 million, 29% less than current year
and drinking water capital needs, estimated to
funding. On July 25, the Senate Committee on
be as high as $300 billion, is once again a
Appropriations approved, in S. 2797 (S.Rept.
major issue. The request sought $3.5 billion
107-222), $8.3 billion for EPA, restoring
for the State and Tribal Assistance Grants
much of the water grant funding.
account, $274.5 million, or 7.3%, less than
FY2002 funding, assuming a discontinuance
The request consists of $3.0 billion for
of earmarked funding. The Senate Committee
EPA’s operating programs, $3.5 billion for
approved $4.0 billion, adding on $140 million
state and local assistance, and $1.3 billion for
for special needs grants.. The request includes
Superfund.
$1.2 billion for Clean Water State Revolving
Funds (SRF); Senate action approved $1.45
EPA’s homeland security efforts may
billion. It also added on $25 million to the
present issues, including the agency’s ability
$850 million requested for drinking water.
to oversee remediation of contaminated build-
ings. In the context of the larger debate on
The request anticipates, and the Senate
congressional earmarking funds, EPA’s ear-
Committee approved, $75 million for Mexi-
marks may be highlighted. Wastewater infra-
can border water projects and $40 million for
structure needs and funding, along with state
State of Alaska projects to which the Senate
roles, and the future of Superfund are likely to
Committee added $5 million. For state and
be prominent topics.
tribal administrative grants, the budget sought,
and the Senate Committee approved, $1.2
While the EPA request is presented
billion, $84 million more than current
according to 10 goals (clean air, safe food,
funding. The Senate Committee approved the
etc.), EPA’s appropriation bill continues to be
requested $200 million for the Brownfields
organized according to traditional accounts.
program, double current year funding.
The $670.0 million requested for the Science
and Technology account reflects a $155.1
.
million reduction; Senate action provides

$710 million. For the Environmental Pro-
Congressional Research Service ˜ The Library of Congress

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MOST RECENT DEVELOPMENTS
On February 4, 2002, the President forwarded to Congress the details of the $7.7
billion FY2003 request for the Environmental Protection Agency. On February 13, the
Senate Committee on Environment and Public Works held hearings on the request; on
February 14, a subcommittee of the House Transportation and Infrastructure Committee
held hearings on the water infrastructure portion of the request. The House Committee on
Appropriations Subcommittee on VA-HUD-Independent Agencies held hearings on March
12, 2002; the Senate Subcommittee held hearings on March 20, 2002. On March 22, 2002,
the Senate Committee on the Budget reported the FY2003 budget resolution, S.Con.Res.100,
which assumes that the Clean Water State Revolving Fund will be fully funded, the
Superfund request will be increased by $113 million, and a proposed enforcement change
will be denied. It also contains a sense of the Senate on adequate Superfund funding. The
House-passed budget resolution. H.Con.Res. 353, assumes full funding of EPA’s operating
programs. On July 25, the Senate Committee on Appropriations reported S. 2797 (S.Rept.
107-222) which included $8.3 billion for EPA.
BACKGROUND AND ANALYSIS
The FY2003 EPA request of $7.7 billion is $458.8 million, or 5.6%, less than the total
FY2002 funding level of $8.2 billion, which included $175 million in terrorism-related
supplemental funding. It seeks fairly level funding for many EPA programs but would
eliminate funding for about $500 million in activities earmarked for funding in the FY2002
conference report (H.Rept. 107-272).
Figure 1 depicts EPA funding by major categories – operating programs, state
assistance, Superfund – since FY1983. Within these broad categories are $2.0 billion for
program management, $680 million for science and technology, and $1.3 billion for
Superfund in the FY2003 proposal. Also under the proposal, funding would decrease by
$275 million in the State and Tribal Assistance Grants account, which incorporates
wastewater/drinking water state revolving funds (SRFs) monies and traditional state program
assistance and management grants. The request for this account includes $1.2 billion for
wastewater SRFs, $850 million for drinking water SRFs, $75 million for Mexican Border
projects, and $1.2 billion for traditional grants to states for administering their programs.
The Senate-reported FY2003 budget resolution, S. Con. Res. 100, assumes that the
Clean Water SRF will be fully funded, the Superfund request will be increased by $113
million, and that a proposed enforcement change will be denied. It also contains a sense of
the Senate that Superfund funding should be adequate to clean up the remaining sites. The
House-passed budget, H.Con.Res. 353, resolution assumes full funding of EPA’s operating
programs
The major issue associated with the request is the discontinuance of funding for a
number of FY2002 activities representing about $500 million, much of which was allocated
to about 300 wastewater projects. Given their enormous popularity, it is likely that
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Figure 1. EPA Funding, FY83 to FY02 Enacted and FY03 Request
State Assistance
Operating Programs
Superfund & LUST
$ Billion
10.00
8.02 8.18
7.59 7.56
7.72
7.36
6.88
8.00
6.67
6.64
6.80
6.60 6.53
6.09
5.54 5.53
5.30 5.06
6.00
4.37
4.18
3.70
3.68
4.00
2.00
0.00
1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Prepared by the Congressional Research Service.
FY2002 totals include $175 million supplemental funding.
reinstatements, or new earmarks, of much of this funding could be pursued during the
FY2003 appropriations process. “Congressional earmarks include research projects targeted
to specific institutions that bypass the normal competitive process; projects that benefit a
limited geographic area with no national significance; and infrastructure projects that bypass
the State formula allocation and priority-setting process,” the budget document argues; it
calculates that the FY2002 appropriation contained 479 earmarks totaling $494 million.
Many Members of Congress disagree with the Administration on the earmarks issue overall
and assert Congress’ right to decide funding priorities in this way. The degree to which
earmarks are allowed may require changes to other parts of the request, depending
on the flexibility afforded the committees under their individual budget allocations, and
within the priorities set for the bill, as the needs of many other competing national programs
such as housing, veterans affairs, disaster assistance and space are assessed.
The FY2003 budget presentation, now referred to as the “2003 Annual Plan,” was the
fifth presented under provisions of the 1993 Government Performance and Results Act
(GPRA), which directs that a performance plan accompany the budget. In 2000, EPA
submitted a second GPRA-mandated strategic plan spelling out its mission and 10 major
goals and associated objectives. Its FY2003 budget justification is aligned with these 10
goals which are:
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1. Clean Air
2. Clean and Safe Water
3. Safe Food
4. Preventing Pollution and Reducing Risk in Communities, Homes, Workplaces and
Ecosystems
5. Better Waste Management, Restoration of Contaminated Waste Sites, and Emergency
Response
6. Reduction of Global and Cross-border Environmental Risks
7. Quality Environmental Information
8. Sound Science, Improved Understanding of Environmental Risk, and Greater
Innovation to Address Environmental Problems
9. A Credible Deterrent to Pollution and Greater Compliance with the Law
(Enforcement)
10. Effective Management
Homeland Security
In the FY2003 budget proposal, the President seeks $133.4 million for EPA’s Homeland
security activities. This is 29% less than the total appropriation of $188.1 million in FY2002.
P.L. 107-206 (H.R. 4775) included $16.1 million in supplemental FY2002 funds for the
Capitol Police Board to reimburse EPA. The Act would have appropriated $50 million more
in FY2002 funds for drinking water facility vulnerability assessments if the President had
declared these emergency funds by September 1, 2002, which he did not do. EPA has several
responsibilities, including protecting its own facilities, determining the vulnerability of the
nation’s water infrastructure, responding to contamination of buildings, monitoring of air
quality at contaminated sites, and conducting research on better cleanup technologies.
The justification for the 29% reduction is, according to EPA, that the special funds,
almost all of which were in the emergency FY2002 terrorism supplemental, were one-time
expenses. Of the $133.5 million requested, most – $75 million – would be directed to
conducting research on better technologies and assessments to clean up contaminated
buildings. The request also includes $19 million to upgrade EPA security. The next largest
allocation would be $17 million for more vulnerability assessments for smaller water systems
along with $5 million in state grants relating to homeland security. Other portions of the
request include $5.5 million for the newly created West Coast Environmental Response
Team and an additional $7.7 million to improve EPA’s response capabilities. The issues for
EPA’s Homeland Security activities are how adequate the Agency’s resources are to protect
its own facilities, to promote protection of the nation’s infrastructure, and to develop better
knowledge about responding to bio- and chemical-terrorism.
EPA’s Budget by Appropriations Accounts
Traditionally, EPA’s budget has been presented, considered, and enacted according
to several major appropriations accounts. These accounts, including environmental programs
and management, science and technology, Office of Inspector General, buildings and
facilities, and oil spills, representing about 39% of EPA’s appropriation, are sometimes
referred to as the “operating programs” and reflect the heart of the Agency’s research,
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regulatory, and enforcement efforts. Two trust fund-based accounts — about 17% of the
Agency’s FY2003 appropriation –- are Superfund and the Leaking Underground Storage
Tank (LUST) Trust Fund. All state supporting activities are reflected in the State and Tribal
Assistance Grants (STAG) account. About 44% of the Agency’s FY2003 appropriation is
allotted to this account. Table 1 shows the breakdown of EPA’s funding by appropriations
accounts.
Table 1. EPA Major Appropriations Accounts:
FY1999-FY2003 Enacted, and FY2003 Request
(in millions of dollars)
FY1999
FY2002
FY2000
FY2001
S.Rept.
P.L.
P.L.
FY2003
Account
P.L.
P.L.
107-
105-276
107-73;
Request
106-74
106-377
222
107-117
Operating
Programs
Science and
Technology 640.0
645.0
709.1
825.0
670.2
710.0
Environment
al Programs
and
Management
1,848.0
1,895.3
2,039.2
2,094.4
2,047.7
2,140.5
Buildings &
Facilities
57.0
62.5
28.3
25.3
42.9
42.9
Office of
Inspector
General
31.2
32.4
40.8
34.0
35.3
35.3
Oil Spill
Response
15.0
14.9
14.6
15.0
15.6
15.6
Superfund
1,500.0
1,400.0
1,392.4
1,274.0
1,273.0
1,273.0
Leaking
Undergroun
d Storage
Tank
Trust Fund
72.5
69.8
70.7
73.0
72.3
72.3
State and
Tribal
Assistance
Grants
3,406.8
3,581.0
3,623.3
3,738.3
3,463.8
4,009.6
EPA Total
All
Programs
7,590.4
7,591.7
8,018.9
8,182.4
7,620.5
8,299.1
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Note: This table shows only the major activities, while totals are for all EPA programs. In FY2000, the conferees elected
to fund the National Institutes of Environmental Health Sciences (NIEHS) and the Agency for Toxic Substances and
Disease Registry (ATSDR) – a total of $130 million – independent of the Superfund appropriation. FY2002 figures include
$175 million in terrorism supplemental funds included in P.L. 107-117, Div. B. P.L. 107-206 (H.R. 4775) included $16.1
million in supplemental FY2002 funds for the Capitol Police Board to reimburse EPA. The Act would have appropriated
$50 million more for FY2002for drinking water facility vulnerability assessments if the President had declared these
emergency funds by September 1, 2002, which he did not do.
Within the many EPA programs, there are numerous issues with respect to
implementing and administering the media (air, water, etc.) protection programs, wastewater
treatment funding, and Superfund.
Science and Technology
The Science and Technology (S&T) account incorporates elements of the former
research and development account (also called extramural research) as well as EPA’s in-
house research, development, and technology efforts. The FY2003 request of $670.0
million for the S&T account represents a 19% decrease when compared to the total FY2002
funding level of $825.0 million. The Senate Committee approved $710.0 million and
reinstated $9.75 million for the Science to Achieve Results (STAR) program which the
Administration has proposed to move to the National Science Foundation. For small drinking
water system arsenic removal research, the Committee added-on $10 million.
Increasing under the proposal would be S&T funds for clean air ( 3%), clean and safe
water, (3%), and quality information (0.5%) goals; safe food, pollution prevention, and
enforcement S&T allocations would decline slightly. The main decreases – about 72%, or
$42.3 million – would be for waste management, almost all from contaminated
site/emergency response activities related to September 11th, and $74.9 million from safe
water goals reflecting completion of vulnerability assessments. In report language, the
Senate Committee directs ths agency to provide, by March 31, 2003, a full accounting of how
the agency has expended drinking water security funds. While the Administration’s decision
not to request about $5.3 million added by Congress in FY2002 funds is a contributing
factor, S&T funds allocated for the global/cross border goal would decline 20% due to the
Administration’s decision to reduce research funds for alternative vehicle technologies. S&T
funds for the effective management goal would decline 42% under the proposal, reflecting
completion of the Research Triangle Park facility.
EPA’s role in climate research and in the Bush Administration’s Climate Protection
Program (CPP), formerly the Climate Change Technology Initiative (CCTI), has been an
issue. EPA requests $136.9 million for its objective to “reduce Greenhouse Gas Emissions”
(research and programmatic activities) in FY2003, a 6%, or $8.4 million, decrease when
compared to current year funding of $145.3 million. About $38 million, or 28%, of the
request is under the S&T account; the rest is under the Environmental Program and
Management request.
There is no funding change planned for the $21 million research program in climate
change. Most categories of the Climate Protection Program would remain at about the same
levels. This includes some research and incentive programs related to buildings, carbon
removal, international capacity building, and state/local programs. What is driving the overall
decrease is the Administration’s decision to reduce Climate Change transportation-related
activities from $30.8 million to $21.6 million in FY2003, a $9.3 million or a 30% reduction.
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This reflects the Administration’s decision to discontinue activities on high-efficiency fuel
engines and developing an 85 miles per gallon family size prototype vehicle. (For a
discussion of climate change issues, see the CRS Electronic Briefing Book on Climate
Change [http://www.congress.gov/brbk/html/ebgcc1.html].)
Environmental Programs and Management
The Environmental Programs and Management account — representing about a
quarter of the Agency’s resources — reflects the heart of the Agency’s regulatory, standard-
setting, and enforcement efforts for various media programs such as water quality, air quality,
and hazardous waste management. The President’s FY2003 budget sought $2.05 billion,
$46.7 million, or 2.2%, less than the FY2002 funding level. The Senate Committee would
provide $2.14 billion. Many controversial regulatory/standard setting issues can be
associated with this account. (CRS Issue Brief IB10067, Environmental Protection Issues
in the 107th Congress, discusses some of them.)
EPM allocations for clean air, safe food, pollution prevention, global activities,
information, enforcement and effective management goals would remain roughly the same
as current year funding. The EPM allocation for clean/safe water would be reduced $63.2
million, or 13%, under the plan. This reflects the Administration’s decision not to request
about $93.6 million in congressional earmarks in the EPM account. For waste
management/emergency response, the EPM allocation would increase $24.8 million or 15%,
almost all of which is accounted for by the new Brownfields program administration
responsibilities. (Another $170 million in grants is funded separately under the State and
Tribal Assistance Grants account.) The Senate Committee approved the requested amounts.
For sound science activities, the EPM portion would increase 6%, or $3.6 million. This
reflects the elimination of the Common Sense Initiative ($1.8 million) which the budget has
labeled as “ineffective” and the addition of $9.6 million in EPM funds for an expanded
regulatory development process, strengthened economic analyses, and regulatory innovation.
Another program labeled as “ineffective” is the environmental education program.
The budget plans to end EPA’s activities authorized under the 1990 National Environmental
Education Act ($9.2 million in FY2002) and transfer them to the National Science
Foundation (NSF). It also would eliminate the Agency’s STAR Fellowship Program ($9.7
million in FY2002) and transfer those functions to the NSF “as part of a larger effort to
increase environmental science education programs” there. (The National Oceanic and
Atmospheric Administration’s Sea Grant program $57 million would also be transferred to
NSF under this plan.) According the NSF’s budget summary, NSF will work in partnership
with the relevant agencies to sustain each program’s major objectives while incorporating
NSF’s experience with merit-based, competitive processes. The Senate Committee on
Appropriations did not approved the Administrations’s planned STAR and environmental
education changes, approving continued FY2003 funding at current levels.
The EPM account funds most of EPA’s enforcement effort. For EPA’s enforcement
goal the budget seeks $402.5 million, $8.9 million, or 2% more than current year funding.
This reflects $15.0 million in new funds for proposed enforcement grants to states, while at
the same time EPA’s own enforcement resources would be reduced $10.0 million This
involves a reduction of 99 full time equivalent positions or FTEs. Appropriators rejected a
similar plan during the consideration of the FY2002 request. The Senate Budget Committee-
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reported version of the FY2003 budget resolution, S. Con. Res. 100, assumes that this
proposal will not be adopted. The Senate Committee on Appropriations also denied this
requested change and included extensive report language on enforcement. It directs the
agency to stop redirecting civil enforcement resources to criminal and to restore civil
enforcement funding. It also directs the agency to develop a plan to fill vacant positions in
the Office of Enforcement and Compliance.
Office of Inspector General
The President’s FY2003 budgets sought, and the Senate Committee, approved, $35.3
million for the Office of Inspector General, $1.3 million more than current year funding.
Buildings and Facilities
The FY2003 requested and Senate Committee-approved $42.9 million for the
Buildings and Facilities account is $17.6 million, or 69.5%, more than FY2002 funding,
reflecting new security needs.
Oil Spill Response
For EPA’s oil spill response activities, the budget sought, and the Senate Committee
approved, $15.6 million, $600,000 more than current funding.
Superfund
In its FY2003 request, EPA sought $1.3 billion for the Superfund account, about
the same level as funded in FY2002. The Senate Committee on Appropriations approved
this amount. Taxing authority to support the Superfund Trust Fund expired on December 31,
1995, and since then the fund balance has been declining. It is anticipated that trust monies
will only be available in significant amounts through FY2003. (Also part of the President’s
FY2003 budget is a $200 million request for cleaning up certain urban sites, called
Brownfields, that have development potential. None of this is funded under the Superfund
account. Most of this ($170 million for grants) will be funded in the State and Tribal
Assistance Grants account and EPA’s administrative expenses under the EPM account.) The
Senate-reported FY2003 resolution S. Con. Res. 100 includes a Sense of the Senate on
Superfund which states:
(a) FINDINGS- The Senate finds the following:
(1) The most contaminated, toxic sites in the country are cleaned up through the Superfund program;
(2) The President’s budget assumes sharp reductions in the number of Superfund sites to be cleaned
up in fiscal year 2003; and
(3) This resolution provides a significant increase in funding for the Superfund program for fiscal
year 2003 compared to the President’s budget proposal.
(b) SENSE OF THE SENATE- It is the sense of the Senate that funding for Superfund be at a level
sufficient to significantly increase the number of toxic waste sites cleaned up through the Superfund
program.
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The resolution, as reported, assumes the $1.273 billion request for Superfund will be
increased by $133 million. The House-passed budget resolution, H.Con.Res. 353, does not
contain similar language.
Two major studies have concluded that the nation’s toxics cleanup program has major
challenges ahead and requires large funding levels for the next few years. Looking ahead,
GAO has estimated that by 2008, 85% of all non-federal National Priority List sites will be
cleaned up (GAO/RCED-00-25, Superfund: Information on the Program’s Funding and
Status). This will entail annual appropriations on the average of at least $875 million
through FY2008, according to GAO. GAO estimates that it will cost between $8.2 billion
and $11.7 billion for studies, design and remedial work to clean up all remaining sites. On
July 10, 2001, Resources for the Future (RFF) released its EPA-funded report requested by
the appropriations committees. Superfund’s Future: What Will It Cost? estimates that for
fiscal years 2000 through 2009, EPA will have to spend $14 billion to $16.4 billion on the
Superfund program and that appropriations will have to be maintained at current levels
through these years. RFF anticipated in its base case scenario that “EPA’s need for Superfund
monies will not decrease appreciably below FY1999 expenditures of $1.54 billion until
2006...”.
In FY2003, the budget anticipates 285 removal response actions, down 17, or 6%,
when compared to current year actions. It also anticipates 40 construction completions, 7 or
18% fewer than for the current year. The reduction in these measures of the Superfund
Program has caused some concern, given the remaining Superfund cleanup challenges.
The President’s FY2003 budget does not propose renewing the taxes that support the
Superfund Trust Fund. According to the budget, the balance of the fund on October 1, 2002,
the beginning of FY2003, will be $427 million. The requested appropriation of $1.3 billion
includes $593 million, or 46%, derived from the fund and $700 million from general
appropriations. With an estimated balance of $28 million anticipated at the beginning of
FY2004, the fund could only be a very minor contributor for that year although some income
sources for the fund - recoveries, interest, offsetting receipts - could increase the amount
available. If the Superfund account levels are to be maintained, general revenues would have
to fund a significant part of the program for that year.
The FY2003 budget represents a significant change in hazardous waste cleanup
policy. For the first time in the Superfund program’s 22-year history, the taxpayer would be
funding the majority -- 54% -- of the program. Some have interpreted this as a departure
from a longstanding “polluter pays” policy in which the industry-maintained trust fund
supported the majority - roughly 70% - of the Superfund program for many years. On
February 25, 2001, in response to questions about the Administration’s support of the
Superfund program, the President stated: “...we’re looking at ways to reform the system to
make sure it works, to make sure it actually accomplishes what Congress wants it to
accomplish.”
The level of appropriations for FY2003 and the role of general revenues will be a
matter for the appropriators to consider. Whether the Superfund tax is reinstated is likely to
be a point of contention. Superfund tax issues have generally been addressed by the revenue
committees.
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Leaking Underground Storage Tanks
The President’s FY2003 budget sought, and the Senate Committee approved, $72.3
million, about the same as current year funding, for the Leaking Underground Storage Tank
(LUST) program, which assists states in addressing substandard underground petroleum
storage tanks.
The status of state LUST programs is a significant issue. Many states are finding it
difficult to finance their programs. At the same time, the fact that the balance of the LUST
Trust Fund has passed the $2.0 billion threshold and the likelihood it will grow even larger
if not drawn upon significantly has led some to call for allowing greater use of the fund
balance by states. (For further discussion, refer to CRS Report 97-471 ENR, Leaking
Underground Storage Tank Cleanup Issues.)
State and Tribal Assistance Programs
The FY2003 request for the State and Tribal Assistance Grants (STAG) account is
once again particularly controversial in Congress since the President requests $3.5 billion,
$274.5 million (or 7.3%) less than FY2002 funding level of $3.7 billion. This reflects the
Administration’s decision not to request funds for activities and grants earmarked in the
FY2002 conference report. The Senate Committee on Appropriations approved $4.0 billion,
adding on $140 million for special needs grants.. The chief elements of the STAG request
include:
! $1.2 billion, as compared to the current level of $1.35 billion for State
Revolving Funds (Clean Water); the Senate Committee approved $1.45
billion;
! $850.0 million for State Revolving Funds (Drinking Water), the same as
currently funded; the Senate Committee approved $875 million;
! $75.0 million, the same as current year for Mexican Border infrastructure
projects and as approved by the Senate Committee action;
! $40.0 million for Alaska Native Village water infrastructure projects, the
current year funding; the Senate added-on $5 million;
! $1.2 billion, $83.9 million more than the current appropriation, for
traditional grants to states for their administration of various environmental
programs; and
! $170 million for the Brownfields program, including $50 for assessment
grants and $120 million for capitalizing Brownfields state revolving funds.
The major capital needs that communities face for funding drinking water and
wastewater facility construction remain the chief issue associated with the STAG account.
By statutory design, the federal contribution to most of these needs has been through
capitalizing state funds from which states loan monies to communities. Since most localities
are now borrowing their funding, any remaining direct grants listed above for special projects
have become controversial. The total national needs remain great. EPA’s 1996 needs survey
for clean water SRF monies estimated remaining needs at $139.5 billion to $200 billion
through the year 2016, while sewerage agencies estimate funding needs may be as high as
$330 billion. EPA acknowledges that funding needs exceed levels in the 1996 needs survey
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and is working on more current assessments. The needs of small communities remain a
special component of this problem.
One estimate has spotlighted the FY2003 water SRF request even more. A
stakeholder group, the Water Infrastructure Network (WIN), in Clean and Safe Water for the
21st Century, estimates total wastewater and drinking water capital needs at around $1 trillion
over the next 20 years, even more if operation and maintenance needs are added in (they
currently are not eligible for federal assistance). WIN estimates that 20-year capital funding
needs for wastewater are about $460 billion and for drinking water about $480 billion. WIN
foresees a $23 billion per year funding gap: $12 billion for wastewater and $11 billion for
drinking water capital needs.
The Senate-reported budget resolution, S. Con. Res. 100, assumes full funding of the
Clean Water State Revolving Fund. This appears to mean the current year level of $1.35
billion and would assume the $1.2 billion request would be increased by $150 million. The
Senate Committee on Appropriations approved $1.45 billion.
In February 2001, EPA issued the second drinking water needs survey which
indicated that public water systems need to invest $151 billion over 20 years. Part of the
increase is attributable to new regulations and about half due to installation and rehabilitation
of transmission and distribution systems.
For state administrative grants, the President’s FY2003 budget sought, and the Senate
Committee approved, $1.2 billion, $84 million more than the current level of $1.1 billion.
These grants fund state programs which administer various environmental protection
programs. Most state grant programs would be funded at current year levels. Funding for
state section 106 water grants would be reduced $12 million, or 6%, while funding for water
quality cooperative agreements would double to a level of $39 million. Under the budget
proposal, new areas would be funded: $15 million for state enforcement grants and $170
million for Brownfields grants. The latter includes $50 million for state administration and
assessments and $121 million for capitalizing Brownfields Revolving funds in the states. The
budget seeks funding of $20 million for the Targeted Watersheds Project for grants to
watershed stakeholders “to implement watershed restoration efforts in a discrete set of
priority watersheds.”
Considerable interest has focused on the proposal to shift more enforcement
responsibility to the states. The budget anticipates $15 million in FY2003 for grants to state
enforcement programs and about 100 fewer FTEs in EPA’s enforcement office. During
consideration of the FY2002 request, appropriators rejected a similar proposal. The Senate
Committee on Appropriations rejected the FY2003 proposal.
LEGISLATION
S. 2797 (Mikulski)
Departments of Veterans Affairs, Housing and Urban Development and Related
Agencies Appropriations Bill for FY2003. Reported July 25, 2002 from the Senate
Committee on Appropriations ( (S.Rept. 107-222).
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IB10101
09-05-02
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
U.S. Congress. House. Committee on Appropriations. Subcommittee on VA-HUD-
Independent Agencies. EPA’s FY2003 Appropriation. Hearings, 107th Congress, 2nd
Session. March 12, 2002. Washington, GPO (to be published)
Senate. Committee on Appropriations. Subcommittee on VA-HUD-Independent Agencies.
EPA’s FY2003 Appropriation. Hearings, 107th Congress, 2nd Session. March 20,
2002. Washington, GPO (to be published)
U.S. Congress. House. Committee on Transportation and Infrastructure. Subcommittee on
Water Resources and the Environment. EPA’s FY2003 Budget. Hearings, 107th
Congress, 2nd Session. February 14, 2002. Washington, GPO. (To be published)
U.S. Congress. Senate. Committee on Environment and Public Works. EPA’s FY2002
Budget Proposal. Hearings, 107th Congress, 2nd Session. February 13, 2002.
Washington, GPO. (to be published)
CHRONOLOGY
02-04-02 – President submits FY2003 budget including $7.7 billion for EPA.
07-25-02 - Senate Committee on Appropriations reports S. 2797 (S.Rept. 107-222) which
includes $8.3 billion for EPA
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