91041: Safe Drinking Water Act: Implementation and Reauthorization

Updated December 3, 1996

CONTENTS

SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS

How Safe is the Nation's Drinking Water?

Pathogens

Organic chemicals

Pesticides

Safe Drinking Water Act and the 1986 Amendments

Regulated Public Water Systems

Reauthorization Issues

Administration Reauthorization Recommendations

Standard-Setting Progress

National Primary Drinking Water Regulations

Enforcement and Compliance

Small Systems and Rural Service

Rural Water System Funding

Budgetary Trends

State Revolving Funds

Congressional Action

LEGISLATION
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
FOR ADDITIONAL READING

SUMMARY

Congress passed the 1974 Safe Drinking Water Act (SDWA), P.L. 93-523, to protect public drinking water supplies from harmful contaminants. The Act, as amended, is administered through regulatory programs that establish standards and treatment requirements for drinking water, control underground injection of wastes that might contaminate water supplies, and protect groundwater. Authorizations for appropriations under this law expired in FY1991; however, funding continued through annual appropriations laws.

In 1986, extensive amendments to the Act strengthened standard-setting procedures, enforcement authority, and groundwater protection provisions. A major mandate for the Environmental Protection Agency (EPA) was to issue drinking water regulations for 83 specified contaminants by 1989 and for 25 additional contaminants every 3 years thereafter. The 1986 Amendments also required that all public water systems using surface water disinfect, and possibly filter, water supplies. Thus far, EPA has regulated 84 contaminants.

In recent years, issues emerging with implementation of the law have prompted congressional interest in revising the statute again. A key issue has involved the increase in state and local mandates without a parallel increase in federal support.

A second issue has involved the ability of public water systems to meet new treatment, monitoring, and reporting requirements; small system compliance has been of particular concern. Most serious violations of drinking water regulations have occurred in small water systems serving fewer than 3,300, which often have limited financial and technical resources to devote to water monitoring and treatment. Because 87% of community water systems are small, improving small system compliance capacity has been a key reauthorization issue.

Other issues have involved how to balance risks and costs in setting standards, how and whether to discourage the formation of new systems that are unlikely to comply, what the proper state and federal roles are, and whether and how to increase Act's focus on pollution prevention.

The Senate unanimously passed a SDWA reauthorization bill, S. 1316, on November 29, 1995. The House passed H.R. 3604 by voice vote on June 25, 1996. On August 2, the House and Senate agreed to the conference report on the SDWA Amendments of 1996 (H.Rept 104-741); on August 6 the President signed the bill (P.L. 104-182). Among other provisions, the law authorizes a state revolving loan fund (SRF) program to finance projects needed for SDWA compliance, requires EPA to conduct cost-benefit analyses and to consider overall risk reduction when setting standards, increases compliance and monitoring flexibility for states and public water systems, and encourages source water protection.

EPA's FY1997 funding bill (P.L. 104-204, H.R. 3666) provides $1.275 billion for capitalization grants for drinking water SRFs. The omnibus appropriations act for FY1997 (P.L. 104-208, H.R. 3610) gives EPA an additional $30 million to implement the Safe Drinking Water Act Amendments of 1996.

MOST RECENT DEVELOPMENTS

On August 2, the House and Senate agreed to the conference report on the Safe Drinking Water Act Amendments of 1996 (H.Rept. 104-741, S. 1316) by votes of 392-30 and 98-0, respectively. On August 6, the President signed the legislation (P.L. 104-182), which had received the support of the Administration, state and municipal organizations, water suppliers, and some environmental groups. Among other provisions, the law authorizes a state revolving loan fund (SRF) program to finance projects needed for SDWA compliance, requires EPA to conduct cost-benefit analyses and to consider overall risk reduction when setting standards, enhances state enforcement authority, increases compliance and monitoring flexibility for states and public water systems, and encourages source water protection. (For additional information, see CRS Report 96-722, Safe Drinking Water Act Amendments of 1996: Overview of P.L. 104-182.)

In EPA's FY1997 funding bill (P.L. 104-204, H.R. 3666), Congress provided $1.275 billion for state capitalization grants for drinking water SRFs. The omnibus appropriations act for FY1997 (P.L. 104-208, H.R. 3610) gives EPA an additional $30 million to implement the Safe Drinking Water Act Amendments of 1996.

BACKGROUND AND ANALYSIS

How Safe is the Nation's Drinking Water?

A key question influencing Congress' enactment of the Safe Drinking Water Act in 1974 remains: How safe is the nation's drinking water? More data are available today, but the interpretation of these data and the question of the proper federal role in assuring safety continue to be debated. When compared to other nations, the United States is believed to have some of the safest drinking water in the world, although numerous pathogens and chemicals of known or possible health concern have been detected in public water supplies. Drinking water standards have been established for dozens of organic and inorganic chemicals, and several pathogens and radioactive contaminants. Yet, EPA and state enforcement data indicate that public water systems annually incur tens of thousands of violations of monitoring/reporting requirements and health standards, thus raising questions as to the Act's effectiveness. Concern also remains over the possible health effects of contaminants for which standards have not yet been set. These and other issues have led Congress to examine ways to improve the federal drinking water program, both in terms of the Act's implementation as well as the structure of the statute itself. Following is an overview of several categories of contaminants.

Pathogens. The most common drinking water contaminants are pathogens (e.g., bacteria, parasites, such as Giardia and Cryptosporidium, and viruses), which typically indicate water contamination by human or animal wastes. Although these microbial contaminants have largely been controlled in U.S. public water supplies, they continue to be the most common cause of water-related diseases in the country. Since 1971, the EPA and the Centers for Disease Control (CDC) have maintained a program for collecting and reporting data on waterborne disease outbreaks. For the two-year period 1993-1994, CDC reports that 17 states identified 30 disease outbreaks associated with drinking water, and that the outbreaks caused an estimated 405,366 persons to become ill, including 403,000 from an outbreak of cryptosporidiosis in Milwaukee, Wisconsin (the largest waterborne disease outbreak ever documented in the United States).

Organic chemicals. Concern about synthetic organic chemicals in the drinking water supplies of some cities was a significant force in the passage of the 1974 Safe Drinking Water Act, even though data were scarce. In 1981, EPA conducted the Ground Water Supply Survey to determine the occurrence of volatile organic chemicals (VOCs) in public drinking water supplies drawing on groundwater. The survey showed detectable levels of these chemicals in 28.7% of public water systems serving more than 10,000 people and in 16.5% of smaller systems. Other EPA and state surveys also revealed VOCs in public water supplies. EPA has used these surveys to support regulation of numerous organic chemicals, many of which are carcinogenic.

Pesticides. Widespread detections of agricultural chemicals (generally a subset of organic chemicals) in ground and surface water have prompted considerable public and governmental concern in recent years. Although concentrations of most of the detected pesticides have been very low, health officials note that little is known about the long-term health effects of low-level exposures to pesticides. In areas of heavy agricultural-chemical use, pesticides have been detected more frequently and at higher levels. In 1992, EPA issued the Pesticides in Ground Water Database (1971- 1991) which showed that nearly 10,000 of 68,824 tested wells contained pesticides at levels that exceeded drinking water standards or health advisory levels. Almost all the data were from drinking water wells. EPA has placed restrictions on 54 pesticides found in ground water, 28 of which are no longer registered for use in the United States but may still be present in soils and ground water.

Safe Drinking Water Act and the 1986 Amendments

Congress passed the 1974 Safe Drinking Water Act (P.L. 93-523) to protect public drinking water supplies from harmful contaminants. The SDWA provides for: (1) national primary drinking water regulations that specify maximum contaminant levels or treatment techniques, (2) underground injection control regulations to protect underground sources of drinking water, and (3) groundwater protection grants for state wellhead protection area programs and for sole source aquifer demonstration projects. The law permits each of these activities to be implemented by the states. Fine-tuning amendments were enacted in 1977 and 1980.

The Safe Drinking Water Act Amendments of 1986 (P.L. 99-339) addressed several perceived deficiencies regarding implementation of the law. These included the view that EPA had been slow in regulating contaminants, states were slow to enforce the law, small communities were overburdened by the Act, and groundwater was not being adequately protected. Consequently, with only 23 standards promulgated by 1986, Congress enacted major amendments to the Act, mandating regulations for 83 contaminants in 3 years and for 25 additional contaminants every 3 years thereafter. Congress also strengthened and expanded the Act's monitoring, compliance, and enforcement requirements, and banned the use of lead pipes and lead solder in new drinking water distribution systems. Provisions that can be particularly costly many public water systems (and, thus, consumers) include surface water filtration requirements, the lead and copper rule, and the proposed radionuclides rules.

The 100th Congress amended the SDWA with the Lead Contamination Control Act of 1988 (P.L.100-572). This law is intended to control lead exposures through drinking water, especially in schools and daycare centers, by requiring the recall of all lead-lined water coolers and establishing an information and screening program for schools.

Regulated Public Water Systems

SDWA regulations for drinking water contaminants apply to both privately and publicly owned systems which serve at least 25 people or 15 service connections (e.g., homes and businesses) at least 60 days per year.

EPA estimates that, nationwide, 200,000 public water systems (PWSs) serving 243 million people are regulated under the Act. Of these, approximately 60,000 are community water systems (CWSs) that serve a residential population of roughly 232 million year-round (about 92% of the population). EPA estimates that 87% of these CWSs are small (i.e., serving between 501 and 3,300 individuals) or very small (serving fewer than 500 individuals). Although numerous, these systems serve only about 10.7% of the population served by CWSs. Another 140,000 PWSs are noncommunity water systems serving nonresident populations. Of these systems, approximately 25,000 are nontransient-noncommunity water systems (e.g., schools and workplaces), and 115,000 are transient-noncommunity water systems serving areas such as camps and hotels.

All CWSs and nontransient-noncommunity systems (NTNCs) are required to comply with all new SDWA regulations. (Prior to the 1986 Amendments, EPA required NTNCs to comply only with regulations for contaminants that cause acute (i.e., short-term) health effects such as bacteria and nitrate). Transient noncommunity water systems (TNCs), which do not regularly serve the same individuals, are required to comply only with regulations for contaminants that cause short-term health effects, with the exception that the 3% of TNCs that use surface water sources must also comply with filtration and disinfection regulations.

Reauthorization Issues

The 1986 Amendments imposed substantial new requirements on EPA, states, and local public and private water suppliers, and numerous issues emerged with the implementation of those amendments. Dominant issues have included EPA's ability to meet the regulatory schedule, states' progress in adopting new regulations, and public water systems' (especially small systems') financial and technical ability to comply with new monitoring and treatment requirements. State and municipal organizations, frustrated with the rapid growth in federal drinking water requirements, targeted the Safe Drinking Water Act as an illustration of "unfunded federal mandates."

Other issues have involved how to balance risks and costs in setting standards, how to improve compliance with the Act, how and whether to discourage the formation of new systems that are unlikely to comply, and what emphasis the Act should give to pollution prevention. (For further information, see CRS Report 95-780, Safe Drinking Water Act Reauthorization Issues.)

Administration Reauthorization Recommendations

EPA's FY1993 appropriations bill included an amendment that directed EPA to report to Congress by July 1993 on various SDWA implementation issues including the benefits and costs of drinking water standards, and alternative ways for systems to comply with federal regulations. EPA issued the report in September 1993 and outlined the Administration's recommendations for SDWA reauthorization.

Briefly, the Administration recommended that Congress: establish a loan fund to help communities build treatment plants and replace lead pipes; protect drinking water source waters from pollution; provide for assessment of water supply systems' capabilities and ensure long-term viability and compliance for these systems; authorize waivers that allow small systems to use less expensive treatment technologies; provide for state programs to train and certify treatment system operators; improve the process for selecting which contaminants will be regulated; set more realistic timeframes for systems to comply with these standards; and strengthen and streamline enforcement. Congress addressed these and other issues in the SDWA Amendments of 1996.

Standard-Setting Progress

A key issue prompting the 1986 Amendments was EPA's progress in developing drinking water standards. Under the 1974 Act, EPA had broad, discretionary authority to set standards. However, by the early 1980s, EPA had regulated only one additional contaminant beyond the 22 standards issued by the Public Health Service before EPA's creation. States urged Congress to establish a firm timetable for EPA to issue regulations out of concern that the federal standard-setting process had worked too slowly. In response, Congress passed SDWA amendments in 1986 specifying that EPA must: 1) within 3 years (by 1989) set drinking water standards for 83 priority contaminants that EPA had identified for study; 2) issue regulations for at least 25 additional contaminants every 3 years thereafter; and 3) review every contaminant regulation at least once every 3 years. The EPA Administrator at that time advised Congress against this provision, arguing that the Agency required some flexibility to set regulatory priorities. Specifically, the Administrator cautioned that "requiring the Administrator to regulate all chemicals listed would preempt decisions based on good scientific evidence and could lead to unsound and unwarranted regulations."

Although EPA was already at work on many of the mandated contaminant standards, many believe the 1986 amendments prompted speedier action. To date, EPA has promulgated regulations for most of the first 83 contaminants (excluding arsenic, radionuclides, and sulfate), and has proposed rules for 13 of the first group of 25 additional contaminants. The mandated regulations cover a variety of contaminants, such as organic chemicals (including industrial solvents and pesticides), and inorganic chemicals (including lead, nitrate, and arsenic).

The 1986 Amendments also require water utilities using unfiltered surface water sources to disinfect and filter or to meet stringent criteria to remain unfiltered. The Surface Water Treatment Rule (SWTR) and Total Coliforms Rule, now in effect, are designed to protect the public from water-borne diseases and apply to transient water systems (e.g., camps) as well as communities. (EPA estimates that the SWTR and the lead rule together account for nearly three-fourths of the costs to public water systems of implementing the first 83 regulations required by the 1986 law.) These rules are expected to significantly improve the safety of the nation's public drinking water supplies. EPA estimates, for example, that full implementation of the new lead rule will protect 600,000 children from unsafe blood-lead levels and reduce lead exposures for another 156 million people. The Agency estimates the disinfection and filtration requirements will prevent a minimum of 80,000 to 90,000 cases of gastro-intestinal illness annually.

In July 1994, EPA proposed an extension to the SWTR to include Cryptosporidium (the microbe that contaminated Milwaukee's water supply in 1993). Concurrent with proposing the enhanced SWTR, EPA proposed a rule to control disinfectants and disinfection byproducts (D/DBPs). (Disinfection byproducts are chemicals that are formed when disinfectants (e.g., chlorine and ozone) are used to purify drinking water. Research suggests that long-term exposure to disinfection byproducts may cause cancer and other adverse health effects.) The goal of the rulemaking effort is to balance the risks of exposure to microbial contaminants with the risks of exposure to disinfection byproducts. Because of the potentially high compliance cost and scientific uncertainty associated with the rules, EPA developed the proposed rules using a negotiated rule-making process that involved various interested parties. All participants agreed that additional research was needed. In May 1996, EPA published a final information collection rule (ICR) to generate data needed to support the development of the enhanced SWTR and the D/DBP rule The ICR requires systems serving more than 100,000 persons to monitor for Cryptosporidium and other microbial contaminants and for disinfectant use. P.L. 104-182 provides research money for these rules and affirms EPA's negotiated rulemaking process and schedule.

New or revised regulations for radon and five other radionuclides were due in October 1993; however, in FY1994, FY1995, and FY1996 appropriations laws, Congress directed EPA not to use funds to promulgate a radon rule. Controlling radon (a naturally occurring contaminant) is expected to provide greater potential health benefits than many other SDWA regulations, but many state and local officials and drinking water suppliers are concerned that the rule will be more costly and less effective than controlling radon from other sources. Moreover, most violations are expected to occur in small systems which have few customers to share compliance costs. P.L. 104-182 directs EPA to set one radon standard using the process under this Act and an alternative standard that is no more stringent than the level equivalent to risks from radon in outdoor air; a state (or public water system) may adopt the alternative standard if it has an EPA-approved multimedia radon mitigation program.

In recent years, broad consensus emerged that the 1986 statutory schedule for regulating drinking water contaminants was overly ambitious and not feasible for EPA, states, or public water systems. EPA has been sued repeatedly for failing to keep apace with the rigorous regulatory schedule, and the Agency has been working under court- ordered schedules for numerous SDWA regulations. In 1993, EPA began to reevaluate and revise its drinking water program in an effort to direct regulatory efforts toward the highest risk contaminants. In an effort to set risk-based priorities, EPA negotiated with the plaintiffs to have court-ordered deadlines extended for the overdue regulations, including those for D/DBPs, radionuclides, and arsenic.

P.L. 102-182 revokes the requirement that EPA regulate 25 contaminants every 3 years, and, instead, allows EPA to select contaminants based on risk and occurrence in water supplies. The amendments also give systems more time to comply with standards by extending the effective date for a new regulation from 18 months to 3 years after promulgation. Up to 2 additional years may be allowed if EPA (or a state in the case of an individual system) determines the time is needed for capital improvements. The 1996 Amendments also set new standard-setting schedules for arsenic, radon, D/DBPs, and Cryptosporidium regulations. On October 21, 1996, EPA expects to have available a new regulatory schedule that reflects the 1996 Amendments.

National Primary Drinking Water Regulations

The Act's standard-setting approach has been widely criticized for being inflexible and for failing to relate benefits to costs. In developing regulations, EPA is required to set a maximum contaminant level goal (MCLG) at a level at which no known or anticipated adverse health effects occur and that allows an adequate margin of safety. EPA must then set an enforceable maximum contaminant level (MCL) as close to the MCLG as is "feasible" using the best technology available, taking costs into consideration. Under this approach, EPA has lacked flexibility to select an MCL that is less stringent than "feasible" but that might provide very similar health protection at a substantially lower cost. Nor could EPA take into consideration whether treatment techniques used to control certain contaminants might actually increase the risk posed by other contaminants. (For example, public water systems use disinfectants, like chlorine, to kill microbial contaminants that can cause illness; however, disinfection by-products may increase the risk of cancer.)

Moreover, EPA's determination of whether a technology was available, and thus what standard is feasible (i.e., affordable), is guided in part by legislative history. Congress has repeated several times in legislative history that EPA's determination of what technologies are "available (taking costs into account)" in setting drinking water standards is to be based on what may reasonably be afforded by large metropolitan or regional systems. Because 80% of the population served by community water systems is served by large systems, this approach generally ensures that most people can receive high quality water at a reasonable cost. However, the remaining 20% of the population is served by smaller systems where economies of scale may be absent, and compliance can impose high costs on households served by these systems. While legislative history is not necessarily binding on the Agency, EPA has relied on it for guidance in determining congressional intent.

In P.L. 104-182, Congress amends SDWA's standard-setting provisions to address several issues. First, the new law gives EPA authority to consider overall risk reduction benefits when setting standards. It permits EPA to set a standard at other than the feasible level if the feasible level would lead to an increase in health risks by increasing the concentration of other contaminants or by interfering with the treatment processes used to comply with other SDWA regulations. In such cases, the standards or treatment techniques must minimize the overall health risk. EPA is authorized to use this authority to consider overall risk reduction benefits when developing regulations for D/DBPs and Cryptosporidium.

The new law also requires EPA, when proposing a regulation, to determine whether or not the benefits of the standard justify the costs. If EPA determines that the benefits of a standard do not justify the costs, EPA may promulgate a standard that maximizes health risk reduction benefits at a cost that is justified by the benefits. EPA may not use this authority to set less stringent standards if the benefits to persons served by large systems would justify the cost to the systems, unless the contaminant is found almost exclusively in small systems. Nor may EPA use this authority in developing regulations for D/DBPs or Cryptosporidium.

P.L. 102-1982 also directs EPA to identify technologies that meet the MCL and are affordable for small systems. If no such technology is available for a contaminant, EPA is required to identify technologies that are affordable for small systems that may not meet the MCL but that may be used in variances.

Enforcement and Compliance

States have primary responsibility for ensuring that systems comply with drinking water regulations. EPA is also authorized to bring enforcement actions, but only after notifying the state and giving the state the opportunity to take action.

Before 1986, a civil suit was EPA's only enforcement tool. The 1986 Amendments authorized the Agency to use administrative orders to enforce the Act, raised five-fold the fines imposed for noncompliance with orders, and required enforcement action to be taken for all violations of the regulations.

EPA estimates that since 1986, the compliance rate for community water systems (CWSs) has remained between 70% and 73%. In FY1992, for example, 16,294 (28%) of CWSs, serving 63 million persons, reported violations. EPA reported that these systems incurred more than 71,000 violations, including more than 63,000 monitoring/reporting violations and 8,000 violations of contaminant standards. In FY1994, public water systems reported 43,354 violations, 19,568 of which involved CWSs. Among CWSs, EPA found that the percentage of small systems (serving fewer than 3,300 persons) in violation was not very different from the percentage of large systems in violation. However, of the significant noncompliers (i.e., those with more serious, frequent, or persistent violations), 77% were very small water systems serving 500 or fewer persons and only 9% served more than 3,300 persons.

Critics suggested that SDWA compliance may be worse than the data indicate, asserting that states and EPA inadequately monitor water system compliance. In 1990, the General Accounting Office (GAO) determined that (1) violations were probably going undetected and unreported by systems and (2) some identified violations were not being reported by states to EPA. The GAO concluded that states' efforts to reduce violations have been hampered by limited resources committed to this program.

While state and federal funding shortfalls have received most attention, EPA also reported that enforcement efforts have been impeded partially by the construction of the law, which contains a number of different, and sometimes inconsistent, enforcement provisions. EPA requested that Congress revise enforcement authorities to make them more consistent with other EPA statutes and to improve compliance.

P.L. 104-182 makes several revisions to the Act's enforcement provisions. It expands enforcement authority to include violation of any "applicable requirement," requires states to adopt authority for administrative penalties for violations of state regulations (to facilitate enforcement at the state level), and allows EPA to assess administrative penalties for violations of compliance orders. The new law also amends public notification provisions to require systems to report violations with potential for serious health effects to customers within 24 hours instead of 2 weeks.

Small Systems and Rural Service

A related and persistent issue involves small water system compliance with the Act. EPA defines small systems as those serving fewer than 3,300 individuals. The Agency estimates that 52,000 (87%) community water systems meet this definition, but that these small systems serve less than 11% of the population. These often rural systems have had the most difficulty meeting drinking water regulations. Most serious SDWA violations have been attributed to small systems that often have inadequate financial and technical resources to devote to water treatment and monitoring.

EPA estimates that drinking water regulations cost most households a little more than $1 per month. However, for those households served by small systems, the costs can be much higher. According to EPA, for systems serving 25-100 persons, the average annual incremental household cost of complying with existing SDWA regulations is $145, compared to $12 for households connected to systems serving between 100,000 and 500,000 individuals.

Congress recognized the problems facing small systems and in 1986 authorized EPA to provide greater technical assistance to small public water systems to help them meet federal requirements. The assistance may be in the form of training programs, circuit-rider programs, or other activities that will directly increase compliance. The Act authorized $10 million annually for small-system assistance. The SDWA provisions offered only a fraction of the assistance small communities need to comply with the Act's growing requirements, and assuring small-system water quality remains perhaps the most challenging environmental health problem facing state and local governments and the water industry. At the time the Act was passed in 1974, many in Congress had anticipated that many small systems would consolidate and form cost-effective regional systems. However, the number of small systems has continued to increase.

In its 1993 SDWA Implementation Report to Congress, EPA offered several recommendations to improve small system compliance, including: (1) establishing a state revolving loan fund program; (2) allowing special variances to systems that install best available technology for small systems; and (3) encouraging the consolidation or restructuring of non-viable systems while deterring the formation of additional non- viable systems. (EPA estimates that 50% of small systems could benefit from some manner of restructuring.) P.L. 104-182 responds to each of these recommendations.

Rural Water System Funding. Until now, the SDWA did not provide funding for construction of drinking water facilities. However, Congress has established several programs that provide funds for drinking water and wastewater projects in small communities. The U.S. Department of Agriculture (USDA) water and sewer grant and loan program is the primary federal funding source for low-income communities of less than 10,000 population. USDA appropriations for FY1996 provide $400 million for water and sewer grants and $597 million for loans. (For more information, see CRS Report 94-838 ENR, Rural Water Supply and Sewer Systems: Background Information.)

Budgetary Trends

State Funding. Grants to states for drinking water programs have increased regularly in recent years. For FY1995, the Administration requested $58.9 million for the State Public Water Supply Supervision (PWSS) grant program, while Congress provided $70 million. For FY1996, the Administration requested $90 million for state PWSS grants, and EPA's FY1996 appropriations bill provided $75 million. EPA's FY1997 appropriations includes $90 million for state PWSS grants.

Despite funding increases, states have noted the growing gap between federal requirements and funding. The statute authorized EPA to pay up to 75% of state administration costs, although the actual federal contribution has averaged about 35% of states' program costs. A few states have imposed an array of surcharges to support their drinking water programs, but many have yet to identify supplemental funding sources. In recent years, states have strongly encouraged Congress to amend the statute, and many Governors have indicated some interest in returning SDWA primacy to EPA, citing the growing gap between federal requirements placed on states and resources provided. Congress responded to this concern, and P.L. 104-182 authorizes $100 million annually for PWSS grants. The law also authorizes states to tap a portion of their SRF funds for technical assistance, source water protection, capacity development, and operator certification programs.

State Revolving Funds. To help communities finance drinking water projects, the Administration's budget request for FY1994 proposed creating a drinking water state revolving fund (SRF) program to be funded at a level of $599 million for FY1994 and $1 billion in each of the following four fiscal years. This program parallels an SRF program Congress authorized in 1987 under the Clean Water Act (CWA) for financing municipal sewage treatment plants.

For FY1994 and FY1995, Congress approved $599 and $700 million, respectively, for drinking water SRFs, contingent upon enactment of authorizing legislation; however, in P.L. 104-19, Congress rescinded all but $225 million of the $1.3 billion approved, noting that enactment did not appear imminent. For FY1996, the President requested $500 million for drinking water SRFs. The omnibus FY1996 appropriations law (P.L. 104-134, H.R. 3019) included $500 million and extended the availability of the $225 million, for a total of $725 million for the SRF program, contingent upon enactment of authorizing legislation by August 1, 1996. If legislation was not enacted by then, the funds would become available for SRFs under the Clean Water Act.

The drinking water SRF program was authorized in P.L. 104-182, enacted on August 6, but because the deadline was missed, the funds became available for CWA projects. On September 5, the Senate passed EPA's FY1997 funding bill (H.R. 3666) with an amendment to increase the amount provided for SDWA SRFs by $725 million, offset by a commensurate reduction to clean water SRFs. The Senate bill also includes $550 million for the SRF program for FY1997; the House-passed version includes $450 million. As enacted, H.R. 3666 (P.L. 104-204) includes $1.275 billion for state capitalization grants for drinking water SRFs.

Technical Assistance. For FY1995, Congress approved $8.5 million to continue funding the National Rural Water Association's technical assistance program. In EPA's FY1996 appropriations bill, Congress again approved $8.5 million for rural water technical assistance activities, as well as $500,000 for continuation of a small public water system technical assistance center. EPA's FY1997 bill includes an increase of $4 million for rural water technical assistance activities. P.L. 104-182 expands technical assistance programs and authorizes increased funding for such activities.

Congressional Action

In the 103rd Congress, the House and Senate passed, nearly unanimously, separate bills to address the issues that have emerged with implementation of the Safe Drinking Water Act. However, risk assessment, cost-benefit analysis, and other issues were not resolved, and legislation was not enacted.

Early in the 104th Congress, leadership of the House Commerce Committee and the Senate Environment and Public Works Committee expressed interest in completing SDWA reauthorization. On October 12, 1995, the Senate Environment and Public Works Committee introduced a bipartisan bill, S. 1316. The Committee held hearings on October 19, at which, EPA Administrator Carol Browner testified that S. 1316 "provides an acceptable framework for strengthening public health protection" and specifically lauded the cost-benefit and risk assessment provisions. The bill was reported on October 24 and passed by the Senate unanimously, with few amendments, on November 29, 1995.

In the House, on January 31, 1996, the Committee on Commerce held a SDWA reauthorization and oversight hearing, while the Committee on Transportation and Infrastructure held a hearing on H.R. 2747, a bill to authorize a water supply SRF program. The Transportation and Infrastructure Committee reported H.R. 2747, amended, on March 29.

The House Commerce Committee, after months of discussions between Majority and Minority Members, unanimously approved a bipartisan bill, H.R. 3604, on June 11, 1996. The House passed H.R. 3604 under suspension on June 25. Reflecting jurisdictional issues, the Manager's Amendment added two titles to the reported version of H.R. 3604; one authorized additional SDWA research funding and coordination, and the second included provisions from H.R. 2747 to conditionally authorize additional appropriations for water infrastructure and watershed protection projects.

Although H.R. 3604 had many similarities to S. 1316, it also contained significant differences. One difference was that H.R. 3604 required public water systems to provide to customers annual "consumer confidence reports" on contaminants detected in the water provided. The Senate rejected a similar amendment during floor debate, at least in part to avoid creating a new unfunded mandate. Also, both bills provided for regulatory variances for small systems that apply "best available affordable technology" (BAAT) in lieu of the best technology; however, S. 1316 authorized these variances for systems serving 10,000 persons or fewer, while H.R. 3604 limited these variances to systems serving 3,300 or fewer persons (consistent with EPA's working definition of a small system). Source water protection provisions differed in the two bills as well. S. 1316 authorized states to adopt programs to act on petitions submitted by local, voluntary partnerships formed by governments or drinking water systems. H.R. 3604 directed states to implement source water assessment programs and made permanent monitoring relief contingent upon the completion of source water assessments. Both bills required states to obtain authority to discourage the formation of new systems that would be unlikely to meet SDWA requirements and to promote restructuring of systems that have ongoing, serious compliance problems. The bills each withheld part of a state's SRF grant if such authority was not obtained, with H.R. 3604 withholding the larger amount (20% as compared to 15% in out years).

Both S. 1316 and H.R. 3604 addressed many SDWA issues including authorizing a drinking water SRF program to help community water systems finance projects to facilitate compliance with federal mandates. They both replaced the requirement that EPA regulate 25 contaminants every 3 years with a process for selecting contaminants for regulation based on risk and occurrence. The bills each gave EPA added flexibility to consider costs and benefits, as well as overall risk reduction, in setting most standards. (Neither applied the authority to consider relative benefits and costs to regulations for D/DBPs or Cryptosporidium). They both authorized states to implement alternative monitoring programs. S. 1316 and H.R. 3604 also included programs for technical assistance, operator training, and capacity building, with H.R. 3604 embracing a stronger federal role in its operator training provisions. Unlike S. 1316, H.R. 3604 withheld 20% of SRF funds from states that do not meet new operator certification requirements. The bills contained similar provisions requiring EPA to establish a screening program for estrogenic substances.

The Administration stated that both bills were acceptable, but more strongly endorsed the House bill. Environmental groups supported the House bill, while rural groups supported S. 1316 but not H.R. 3604. State and municipal government groups and water suppliers expressed general support for both bills, but expressed some reservations about new federal authorities and unfunded mandates in H.R. 3604.

House and Senate conferees reached agreement on compromise drinking water legislation (S. 1316) on August 1. On August 2, the Senate and House agreed to the conference report (H.Rept. 104-741) by votes of 98-0 and 392-30, respectively. President Clinton signed the bill on August 6 (P.L. 104-182). The measure includes: a revised House provision requiring systems to issue annual reports to customers on contaminants found in drinking water; a compromise radon measure that allows states to adopt a less stringent radon standard if they establish a multimedia radon mitigation program; a modified Senate provision that allows states to transfer up to 33% of the amount of the SDWA SRF to the CWA SRF or a similar amount from the CWA SRF to the SDWA SRF; a compromise provision allowing small systems to receive BAAT variances and medium sized systems to also receive such variances if approved by EPA; and a modified House provision authorizing an additional $50 million dollar per year grant program for additional infrastructure and source water protection projects. The conference agreement references the estrogenic substances screening program created under the new food safety law (P.L. 104-170, H.R. 1627) and authorizes EPA to provide for the testing of estrogenic and other substances that may be found in drinking water if EPA determines that a substantial population may be exposed.

In EPA's FY1997 funding bill (P.L. 104-204, H.R. 3666), Congress provided $1.275 billion for capitalization grants for drinking water SRFs. The omnibus appropriations act for FY1997 (P.L. 104-208, H.R. 3610) provides EPA with an additional $30 million to implement the Safe Drinking Water Act Amendments of 1996.

LEGISLATION

P.L. 104-182, S. 1316
Amends and reauthorizes the SDWA; authorizes a drinking water SRF program; establishes new contaminant selection and standard setting processes; directs EPA to conduct a benefit-cost analysis for most new standards; authorizes EPA to balance competing health risks and to consider relative benefits and costs when setting most standards; provides new regulatory flexibility for states and public water systems; revises public notification and variance provisions; directs EPA to identify technologies affordable for small systems; provides greater technical assistance for small systems; establishes new source water protection programs; amends the FFDCA to require the Food and Drug Administration to issue bottled water standards for each tap water contaminant regulated under SDWA; etc. Introduced October 12, 1995; referred to the Committee on Environment and Public Works; reported unanimously, amended on October 24, 1995 (S.Rept. 104-169); passed Senate 99 to 0 on Nov. 29, 1995. Conference report filed Aug. 1, 1996 (H.Rept. 104-741). Approved by House August 2 (392 - 30) and by the Senate August 2 (98 - 0). Signed into law August 6, 1996.

H.R. 226 (Dingell)
Amends and reauthorizes the SDWA (identical to the bill passed by the House in the 103rd Congress.) Authorizes an SRF program; revises standard-setting process and schedule; establishes a new variance program allowing small systems to use best available affordable technology (BAAT); authorizes more cost-effective approaches for sulfate, arsenic, and radon regulation; increases technical assistance; etc. Introduced on January 4, 1995; referred to Committee on Commerce.

H.R. 2747 (Shuster)
Water Supply Infrastructure Assistance Act of 1995 authorizes $4.25 billion in appropriations over 5 years for drinking water system upgrades; 10% of funds may be for source water protection projects. Funds would be made available through accounts established within existing state revolving loan funds under the Clean Water Act; includes an allotment formula for distributing funds among the states. Authorizes EPA to make 50% grants for improvement of water systems and for source water protection programs, including source water protection grants for the New York City watershed and grants to Alaska for water systems for Alaska Native villages. Introduced on December 7, 1995; referred to Committee on Transportation and Infrastructure; hearing held on January 31, 1996; approved, amended, by the Subcommittee on Water Resources and the Environment on March 6, and reported, amended, by the full Committee on March 29, 1996 (H.Rept. 104-515); placed on Union Calendar.

H.R. 2762 (Johnson, T.)
Requires EPA to undertake additional research prior to the promulgation of a standard for sulfate under SDWA and directs EPA to repropose the sulfate regulation. Introduced on December 12, 1995; referred to the Committee on Commerce.

H.R. 2601 (Bilbray)/S. 412 (Snowe)
Amends the Federal Food, Drug, and Cosmetic Act (FFDCA) to require the Food and Drug Administration to issue bottled water standards for each contaminant regulated under SDWA that occurs in bottled water. S. 412 was introduced on February 14, 1995; referred to the Committee on Environment and Public Works. H.R. 2601 was introduced on November 9, 1995; referred to the Committee on Commerce.

H.R. 3280 (Waxman)
The Water Quality Public Right-To-Know Act of 1996 expands SDWA public notification provisions. EPA has 3 years to issue regulations requiring community water systems to issue annual consumer confidence reports on the levels of regulated and unregulated contaminants in a system's drinking water. Reports must include information on health implications for contaminants present at below-regulatory levels. Introduced April 18, 1966; referred to Committee on Commerce.

H.R. 3293 (Lowey)
Amends the SDWA to require EPA to establish a screening program for estrogenic substances. Introduced on April 23, 1996; referred to the Committee on Commerce.

H.R. 3429 (Saxton)
The Water Quality Public Right-To-Know Act of 1996 expands SDWA public notification provisions. EPA has 18 months to issue regulations requiring each community water systems to issue annual consumer confidence reports on the levels of regulated and unregulated contaminants in a system's drinking water. Reports must be mailed to customers and published in newspapers, and include information on existing standards, compliance, and health implications for contaminants present at below-regulatory levels. Introduced May 9, 1996; referred to Committee on Commerce.

H.R. 3604 (Bliley, Dingell, Bilirakis, Waxman, and others)
Amends and reauthorizes SDWA; authorizes a drinking water SRF program; establishes new contaminant selection and standard setting processes based on risk and occurrence; directs EPA to conduct a benefit-cost analysis for most new standards; authorizes EPA to balance competing health risks and to consider relative benefits and costs when setting most standards; provides new regulatory flexibility for states and public water systems; revises public notification and variance provisions; directs EPA to identify technologies affordable for small systems; establishes an estrogenic screening program; establishes a new state source water assessment and delineation program; requires public water systems to issue annual consumer confidence reports to customers; amends the FFDCA to require the Food and Drug Administration to issue bottled water standards for each tap water contaminant regulated under SDWA; etc. Approved by the Subcommittee on Health and the Environment on June 6, 1996; reported by the Committee on Commerce on June 24, 1996 (H. Rept. 104-632); passed by the House on June 25.

CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS

U.S. Congress. Senate. Committee on Environment and Public Works. Safe Drinking Water Act Amendments of 1995. Report on S. 1316, 104th Congress, 1st session. Nov. 7, 1995. Washington, U.S. Govt. Print. Off., 1995. S.Rept. 104-169. 230 p.

U.S. Congress. Senate. Committee on Environment and Public Works. Safe Drinking Water Act Amendments of 1995. Hearing on S. 1316, 104th Congress, 1st session. Oct. 19, 1995. Washington, U.S. Govt. Print. Off., 1995. S.Rept. 104-354. 532 p.

U.S. Congress. House. Committee on Commerce. Safe Drinking Water Act Amendments of 1996. Report on H.R. 3604, 104th Congress, 2d session. June 24, 1996. Washington, U.S. Govt. Print. Off., 1996. H.Rept. 104-632. 134 p.

U.S. Congress. House. Committee on Transportation and Infrastructure, Subcommittee on Water Resources and Environment. Hearing on H.R. 2747, the Water Supply infrastructure Assistance Act of 1995. 104th Congress, 2d session. Jan. 31, 1996. Washington, U.S. Govt. Print. Off., 1996. H.Rept. 104-45, 218 p.

U.S. Congress. Congressional Budget Office. The Safe Drinking Water Act: A Case Study of an Unfunded Federal Mandate. September 1995. 46 p.

U.S. General Accounting Office. Drinking Water: Stronger Efforts Essential for Small Communities to Comply with Standards; Report to the Chairman, Subcommittee on Environment, Energy, and Natural Resources, Committee on Government Operations, House of Representatives. March 1994. 60 p. GAO/RCED-94-40

FOR ADDITIONAL READING

U.S. Environmental Protection Agency. Technical and Economic Capacity of States and Public Water Systems to Implement Drinking Water Regulations. Report to Congress. September 1993. EPA 810-R-93-001. 125 p.

-----Strengthening the Safety of our Drinking Water: A Report on Progress and Challenges and an Agenda for Action. March 1995. EPA 810-R-95-001. 22p.

Olson, Eric D, et al. Trouble on Tap: Arsenic, Radioactive Radon, and Trihalomethanes in Our Drinking Water. Natural Resources Defense Council with Clean Water Action and U.S. Public Interest Research Group. October 1995. 62 p. and tables.

Raucher, Robert S. et al. "Cost-effectiveness of SDWA Regulations." Journal of the American Water Works Association, August 1994. p. 28-36.

Shanaghan, Peter. "Small Systems and SDWA Reauthorization." Journal of the American Water Works Association, May 1994. p. 52-61.