EPA Receptive to City and County Concerns about Affordability of Mandates

I was part of a delegation from the National League of Cities, United States Council of Mayors, and the National Association of Counties that met with the EPA to discuss the affordability of mandates.  This meeting, held on Friday, December 13, 2013 was attended by Deputy Administrator Bob Perciasepe as well as other senior level staff. 

Discussions centered on the policy framework that supports the 1997 “Combined Sewer Overflows: Guidance for financial Capability Assessment and Schedule Development.”  This framework provided guidance as to what the EPA regional administrators and localities may expect when determining the affordability of consent orders and permits.  The framework is a great improvement to the existing guidance as it takes into account other costs associated with the implementation of the Clean Water Act as well as other mandates at the local level.  It supports a holistic approach, encompassing concerns such as combined sewer overflows, sanitary sewer overflows, storm water management, and local total maximum daily load requirements.

Concerns from the localities were based on specific language concerning the affordability and what items could be considered as part of the cost for implementation.  Of primary concern was the EPA’s baseline standard that 3% of the median household income be used to determine affordability of sewer rates.  Localities argued that using an indexed average annual income would be a more accurate statistical tool as it would exhibit the effect of sewer rates on low income households.  Continuing to use the median household income will require low income households to spend a larger percentage of their annual income on sewer rates. 

Additionally, the framework contained language that could be construed to provide guidance to the EPA’s regions that some information may, or may not, be considered.  Localities argued that the EPA regions must consider all the additional costs associated with Clean Water Act mandates.  Interestingly enough, the EPA wrote the framework under the perception that the localities were the audience.  It was their intent to provide flexibility to the localities as to what cost information could be shared with the EPA.  The localities read the framework as direction to the regions, providing the regional administrators flexibility in selecting what costs to consider in assessing affordability.  Once this basic misunderstanding was cleared up, the solution was quickly agreed upon where EPA regional must consider all the costs that the localities choose to share. 

The last major point concerned the overall cost to homeowners of the combined water and sewer bill.  The EPA agreed that Safe Drinking Water Act cost have to be considered by during assessing the affordability of consent orders and permits.  Several localities, such as my own, Lynchburg, Virginia, combine stormwater utility fees, sanitary sewer fees, and water fees into on consolidated bill.  As these are real costs that require a disproportionally higher percentage of the annual income of low income households on utility fees, it is critical that the entire water bill be considered when assessing affordability. 

Other key considerations included timeframes for implementation, priorities to protect public health, and an evaluation of local economic conditions in determining affordability.  As a whole, I was very pleased the level of discussion and the engagement of the EPA’s senior staff.  As the Mayor of Akron, Ohio, Donald Plusquellic, stated at the conclusion of the meeting, now is the time to forge agreements and make progress with the EPA since there is such a good team to work with.  According to the Mayor, these discussions have not always been congenial and this group of senior leadership is a refreshing change. 

To continue our current progress, a small work group will be convened to finalize the language of the draft framework.  This is a positive step, and we will continue to work with the EPA to advance issues raised by localities concerning the affordability of consent orders an permits.  We made great strides during this meeting, and we look forward to continue the dialog as this policy framework is finalized.