Clean Water Issues in the 105th Congress

Clean Water Issues in the 105th Congress

96-910 ENR
Updated August 21, 1997
Clean Water Issues in the 105th Congress
Claudia Copeland
Specialist in Environmental Policy
Environment and Natural Resources Policy Division
Summary
For the 105 Congress, reauthorization of
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the Clean Water Act may be a priority
in the second session. The Act was last amended in 1987 and authorizations expired on
Sept. 30, 1990. Clean water was a priority for the last two Congresses, but no legislation
was enacted. In the 104 Congress, the House passed a comprehensive reauthorization
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bill, but during House debate and subsequently, controversies arose over whether and
how the Act should be made more flexible and less burdensome on regulated entities.
Issues likely to be of interest again in the 105 Congress include funding, overal
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flexibility and regulatory reform of water quality programs, and measures to address
polluted runoff from farms and city streets. Reforming the Act’s wetlands permit
program, a pivotal and contentious issue in the recent past, also remains on the legislative
agenda for many. During the first session, committees with jurisdiction are giving
priority to reauthorizing two other laws, Superfund and the Intermodal Surface
Transportation Act.
Background and Recent Activity
The Clean Water Act (CWA) is the principal law governing pollution in the Nation’s
lakes, rivers, and coastal waters and authorizing funds to aid construction of municipal
wastewater treatment plants. Originally enacted in 1948 and significantly revised in 1972
(P.L. 92-500), the Act was last amended in 1987 (P.L. 100-4). These amendments are
now being implemented by states, cities, the federal government, and regulated industries.
The CWA has been viewed as one of the Nation’s most successful environmental laws in
terms of achieving the statutory goals, which have been widely supported by interest
groups and the public, but lately has been criticized over whether the benefits have been
worth the costs.
Such criticisms have come especially from industry, which has been the traditional
focus of the Act’s regulatory programs and which opposes imposition of additional more
stringent and costly requirements. Criticism also has come from developers and property
rights groups who contend that federal regulations (particularly the Act’s wetlands permit
program) are a costly intrusion on private land-use decisions, thus raising concern about
regulatory “takings.” States and cities have traditionally supported water quality programs
and favored reauthorization in order to obtain more funding to carry out the law, but

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recently many opposed CWA measures that might impose new unfunded mandates.
Environmental groups believe that further fine-tuning to strengthen the Act is needed to
maintain progress achieved to date and to address remaining water quality problems.
The Act consists of two major parts: regulatory provisions that impose progressively
more stringent requirements on industries and cities to abate pollution and meet the
statutory goal of zero discharge of pollutants; and provisions that authorize federal
financial assistance for municipal wastewater treatment plant construction. Both major
parts are supported by research activities, plus permit and penalty provisions for
enforcement. In the past, congressional efforts to amend the CWA have dealt with all
aspects of the law, with the objective of strengthening water quality programs.
In the 104
th Congress, the CWA was one of the first environmental laws to receive
congressional attention. A comprehensive reauthorization bill, H.R. 961, was approved
by the House Transportation and Infrastructure Committee in April 1995 and passed the
House in May. H.R. 961 reflected efforts to make the Act more flexible and less
prescriptive and to address regulatory relief issues raised by industries, states, and cities,
who had criticized what they view as excessive and prescriptive clean water regulation.
The legislation was endorsed by industry, state, and local government groups, but was
opposed by environmental groups and the Clinton Administration. Officials of the
Environmental Protection Agency (EPA) said that the bill would undermine the existing
framework for protecting U.S. waters. During its consideration of the bill, the House
adopted more than a dozen amendments but rejected others offered by Democrats and
moderate Republicans that sought to modify aspects of the committee’s legislation.
The House-passed bill was subsequently labeled by environmentalists as “the Dirty
Water Bill,” and many observers contended that legislative efforts to reform clean water
programs had overreached and resulted in controversy, not consensus. Supporters of the
bill disputed the environmentalists’ characterization of H.R. 961 and said that they also
support strong clean water programs, but favor approaching pollution control in a more
collaborative and less commanding way based on better priority-setting, considering costs
and benefits of controls, and devolving authority to state and local governments. In the
Senate, reauthorization legislation was not introduced, and no hearings on H.R. 961 were
held; thus, no CWA amendments were enacted. (For more information, see CRS Issue
Brief 97001, Clean Water Act Reauthorization in the 105 Congress.
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.)
Broad Issues Affecting Clean Water Act Reauthorization
Legislative prospects for the CWA in the 105 Congress are uncertain, in par
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because the issues and controversies which were unresolved in the 104 Congress ma
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recur. Some issues are specific to the clean water statute. Others are broader than this
law and broader even than other environmental laws. These broader issues include: private
property “takings” (federal regulatory actions considered to infringe on property rights and
diminish the value of private property holdings) and regulatory reform and risk assessment
(defined as whether EPA should be required to conduct risk and cost/benefit analysis in
developing regulations or in setting regulatory priorities). Private property takings arise
in connection with many regulatory activities which have the potential to restrict an
individual’s use of property (from zoning to protection of threatened or endangered
species). Support for greater consideration of the costs and benefits of regulation is
similarly not exclusive to environmental standards and rules.

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These issues and a third — unfunded mandates (federal requirements imposed on
states and cities without sufficient funding or flexibility to achieve them) — affected
consideration of the Clean Water Act since 1993. Along with other reforms, they were
included in the House Republican “Contract with America.” The 104 Congres
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addressed the unfunded mandates issue in a measure (P.L. 104-4) that requires the Senate
and House to take a separate, majority vote in order to pass any bill that would impose
unfunded mandates of more than $50 million on states and cities or more than $100 million
on the private sector. Another enactment, P.L. 104-121, authorized congressional review
of major federal agency regulations. Both regulatory “takings” and regulatory reform
were addressed in the House-passed CWA bill, H.R. 961, and both were included in a
broad measure passed by the House to carry out a number of items in the Contract with
America (H.R. 9). The Senate did not act on H.R. 9 or other comprehensive regulatory
reform legislation (S. 343).
In the 105 Congress, re
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newed attention to these broad issues is likely, but the form
of that attention is uncertain. Congress could approach these issues in comprehensive
legislation affecting not just the CWA, not just EPA, but many other programs,
departments, and agencies (similar to H.R. 9 in the 104 Congress). Or, the issues might
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be considered in the context of statute-specific debates, as the 104 Congress did i
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regulatory reform and risk analysis provisions that were enacted in amendments to the Safe
Drinking Water Act (P.L. 104-182) and the Food Quality Protection Act of 1996 (P.L.
104-170).
Clean Water-specific Issues
One reason that reauthorization of the CWA may receive congressional attention is
that authorizations for most current programs expired Sept. 30, 1990. If the 105
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Congress does take up the Act, a number of specific issues which were debated in the 104th
Congress are likely to be the core of clean water legislative activity. Among the issues
likely to receive attention are funding; regulatory reform and cost-benefit analysis in the
Act; regulation or protection of wetlands; and management of nonpoint source pollution.
Also likely is oversight and possible legislation concerning initiatives at EPA that affect
water quality programs.
All of the CWA issues likely to receive attention in the 105 Congress (funding
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polluted runoff, wetlands protection, and regulatory requirements) have been open for
debate for several years, even before Republican majorities were elected to the House and
Senate in the 104 Congress. What is at i
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ssue is how these issues are framed and whether
proposed changes are seen as strengthening or weakening the law.
Wastewater Funding . The 1987 CWA amendments authorized $18 billion to aid
construction of wastewater treatment facilities through FY1994 and established a new
program of federal grants to capitalize State Water Pollution Control Revolving Funds,
or state loan programs (SRFs). Although authorizations expired, and initial congressional
1 Rules of the House of Representatives require enactment of an authorization before funds
can be appropriated for a federal activity, although that requirement can be and frequently is
waived. Thus, even though the authorization for CWA appropriations did expire, programs under
the Act do not lapse, and Congress has continued to appropriate funds to carry out the Act.

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intent was to phase out federal financial support for this program, Congress has continued
to provide grant appropriations to the states, providing an average of $1.7 billion annually
in recent years. The most recent survey by states and the EPA estimates that total national
wastewater treatment funding needs are $137 billion to be spent over the next two
decades. Thus, because remaining funding needs are still so large, at issue is how to
extend SRF assistance to address those needs and modify the SRF program to aid priority
projects. Of particular concern is how to assist small and economically disadvantaged
communities that have had the most difficulty in adjusting from the Act’s previous
categorical grants program to loans.
The House-passed CWA bill in the 104 Congress, H.R. 961, authorized $11.4
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billion for SRF capitalization grants through FY2000. It included a new state-by-state
allotment formula for distributing SRF grants and several provisions to assist small and
disadvantaged communities (e.g., longer loan repayment, negative interest loans). The
funding provisions are a significant aspect of the law as a whole and are of great interest
to many stakeholder groups. During recent debates, these provisions have been less
controversial than debate over others, such as wetlands reform, because of general
agreement on the need to extend funding assistance and address small community
concerns. Greater controversy has arisen during Congress’ budget and appropriations
process, where funding for wastewater infrastructure competes with the need and desire
to fund other national programs.
Regulatory Reform: Cost-Benefit Analysis and Risk Assessment. An issue
raised often in recent legislative debates is concern over the cost to society and the
economy of complying with environmental regulations. EPA has estimated that, by the
year 2000, U.S. investments for pollution control for all media could represent nearly 3%
of Gross Domestic Product, a level that critics of regulation assert is excessive. Annual
water pollution control costs, which have increased steadily over time, are estimated by
EPA to be $58 billion in the year 2000, about 36% of projected total pollution control
costs at that time. Reducing the cost and burden of federal regulation has been a theme
of regulatory reform legislation.

Technically, it is more difficult to quantify the benefits of regulation than to estimate
costs, making the overall policy debate uneven at times, since benefits are often less
tangible than costs. As part of the FY1997 omnibus appropriations bill (P.L. 104-208),
Congress directed the Office of Management and Budget to submit annual reports
beginning Sept. 30, 1997, estimating the total annual costs and benefits of federal
regulatory programs, using quantitative and qualitative measures of both. It is hoped that
these reports will inform future debate.
In debating the CWA in the 104 Congress, supporters of H.R. 961 argued tha
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policymakers and regulators need information based on sound scientific analyses of the
potential risks to public health and the environment and need to be able to weigh the costs
of CWA regulations against their benefits. Thus, the House-passed CWA bill sought to
insert greater consideration of cost in implementation of the law and sought to make risk
assessment a much more prominent element of CWA decisionmaking. Critics of the bill
said that risk assessment and risk management tools already are used by EPA, while the
bill would impose on EPA a rigid decisionmaking process likely to postpone needed
actions. It is likely that momentum for benefit-cost reform will continue in the 105th
Congress, as the issue has had bipartisan interest. Basic elements likely to be considered

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are providing regulatory flexibility while ensuring no rollback of public health and
environmental protection. Environmentalists continue to favor limited use of risk and
cost-benefit analysis in rulemaking, while many in industry have sought more prescriptive
reforms and more opportunity for judicial review of agency decisions. Some observers
believe that regulatory reform proponents will pursue statute-by-statute reform of the
CWA and other laws, rather than omnibus legislation.
Regulatory Protection of Wetlands. How best to protect the Nation’s remaining
wetlands and regulate activities taking place in wetlands has become one of the most
contentious environmental policy issues, especially in the context of the CWA which
contains a key wetlands regulatory tool, the permit program in Section 404. It requires
landowners or developers to obtain permits from the U.S. Army Corps of Engineers to
carry out activities involving disposal of dredged or fill material into navigable waters of
the United States, including wetlands. EPA provides environmental guidance on
permitting and can veto a permit, based on environmental impacts. Controversy has
grown over the extent of federal jurisdiction, burdens and delay of permit procedures, and
roles of federal agencies and states in the permitting process.
Among recent proposals for amending Section 404, a number of issues have been
raised, including: whether all wetlands should be treated the same or not and whether some
could be accorded less stringent regulatory protection; whether activities or areas covered
by federal regulation should be modified; and whether federal and state roles in
implementing Section 404 should be revised. Views on each of these issues vary. Many
conservationists contend that statutory changes that have been proposed would weaken
wetlands protection and that more modest administrative reforms would effectively
improve the current program. Many landowners say that changes are needed to make the
regulatory program workable again. They also argue that the CWA should compensate
landowners whose property is adversely affected by regulatory “takings” due to Section
404 requirements, since an estimated 74% of all remaining wetlands are on private lands.
In the 104 Congress, House-passed H.R. 961 would have significantly amende
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Section 404. It contained several provisions that contributed greatly to controversy over
and opposition to that bill. These included a requirement to compensate landowners if
federal agency action under Section 404 diminishes the fair market value of property by
20% or more; a wetlands classification system allowing for differential regulatory
procedures and requiring no permits in areas classified as least ecologically valuable; and
eliminating EPA’s role in the permitting process.
Management of Nonpoint Source Pollution. Surveys by states and EPA report
that polluted runoff from agriculture and city streets and storm sewers is the leading cause
of water quality impairment in the United States. These nonpoint sources of water
pollution, along with runoff from forestry and construction sites, land disposal activities,
and atmospheric deposition of air pollution contaminants, are believed to contribute more
than 50% of remaining water quality problems in rivers, lakes, and coastal waters. The
1987 CWA amendments established the first comprehensive program in the Act to address
nonpoint source pollution through state management programs utilizing technical and
financial assistance from EPA. Because the sources of nonpoint pollution are diverse, as
are the geographic areas it affects, it is generally agreed that management solutions are
best if they are tailored to local conditions, not dictated through national rules and
regulations. At issue is whether and how to establish programs in the CWA with minimum

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standards to ensure that progress towards water quality goals continues to be made, while
providing sufficient state and local flexibility and incentives for sources to manage polluted
runoff.
Reinventing Government at EPA - Oversight and Possible Legislation. EPA has
been at the center of many of the Clinton Administration’s efforts to reinvent government,
to create a government that works better and costs less. At EPA, these activities include
new flexible funding and regulatory arrangements for states and industries, proposals for
alternative compliance strategies, and a great many program-specific initiatives, as well.
In the water quality program, EPA is moving away from its traditional regulatory approach
which focused on controlling industrial and municipal pollution sources. Many of EPA’s
water quality initiatives start from one based on a watershed approach to problem-solving.
This approach recognizes that remaining water quality problems require attention to
diffuse (nonpoint) as well as discrete (point source) pollution sources on the basis of
geographic areas defined by natural or hydrologic features, instead of political boundaries.
Further, the watershed approach is more community-based than top-down in emphasis and
is intended to be a process that involves key government, citizen, and other user groups
as full partners in developing solutions. EPA is using the broad watershed approach to
address specific water pollution issues, including managing nonpoint sources, stormwater
runoff, and sewer system overflows. (For more information, see CRS Report 96-283
ENR, Reinventing the Environmental Protection Agency and EPA’s Water Programs.)
Congressional oversight of these activities could occur in the 105th Congress, in
response to criticism from a wide range of interests that the initiatives are delivering far
less than has been expected. Questions may be raised, on the one hand, about whether
EPA’s implementation of these initiatives reflects a true commitment to regulatory
flexibility and, on the other hand, whether the initiatives are promoting flexibility and
reduced federal oversight to the extent that core elements of environmental protection
programs might be diminished. Some in Congress may propose legislation — possibly in
connection with CWA reauthorization — to provide a clear statutory basis for the
initiatives and to clarify the scope and direction of EPA’s government reinvention
activities.