There is a saying in governance: “Don't tell me what you value. Show me your budget, and I'll tell you what you value.”
We know Minnesotans value clean water. This year, there are three priority clean water investments that the state must make to reflect those values: Bonding, CREP and the Clean Water Fund payback.
Water infrastructure bonding: $167 Million
Governor Dayton has requested $167 million in water infrastructure bonding to begin fixing drinking water and wastewater systems across the state.
These bonding investments in clean water are now more important than ever; Minnesota's general fund money for the environment is near an all-time low, and there is limited likelihood of a meaningful supplemental budget (non-bonding) funds for clean water investments this year.
Meanwhile, the costs for water infrastructure maintenance are ballooning across the state. For example, many of our state’s local wastewater treatment systems were built with federal dollars in the 70s and 80s – money which is no longer available. Many of these systems are now well past their expected useful life, and the total statewide cost for fixes is estimated to be about $5 billion over the next 20 years.*
We strongly support strong investment in upgrading and maintaining these systems, especially in greater Minnesota where smaller communities may lack the tax base to afford such investments on their own.
While the details of the Governor’s bonding proposal are pending, we expect it will follow Minnesota tradition by dedicating at least 22% of state bonding money to environment and conservation investments. We are hopeful the proposal will including the following water infrastructure items:
- Wastewater Infrastructure Fund (WIF) ($80 million): Supplemental assistance grants to municipalities for high-cost clean water and drinking water infrastructure projects that address existing environmental or public health problems. Wastewater Infrastructure Fund (WIF) funds are used to supplement either low-interest loans from the Clean Water Revolving Fund or to match grant and loan funding from the U.S. Department of Agriculture (USDA) Rural Development Fund. This funding could also support an expansion of this program to include drinking water infrastructure projects.
- Point Source Implementation Grants (PSIG) ($62 million): Point Source Implementation Grants (PSIG) help local governments fund water treatment plant upgrades to meet water quality restoration and protection goals. Funding is allocated on a competitive basis and provides grants of up to half of eligible costs, with a local match required.
- Water infrastructure initiative ($25 million: If approved, this $25 million in state funds would be matched by $85 million in federal Clean Water and Drinking Water Revolving Funds. State and federal funds are used together with loan repayments and PFA revenue bonds to provide low-interest loans to local governments for clean water infrastructure, which includes wastewater, stormwater, and drinking water projects. Eligible projects are prioritized based on environmental and public health criteria.
Conservation Reserve Enhancement Program (CREP) bonding: $47 Million
CREP is a state conservation program that builds off the federal Conservation Reserve Program (CRP) to works with farmers and private landowners to restore and protect water quality in primarily agricultural regions. The program compensates private landowners for granting permanent conservation easements on their lands. State bond funds will leverage up to $120 million in federal funds as a part of a 5-year initiative aimed at protecting water by conserving 100,000 acres of land.
Payback the Clean Water Fund raid: $22 million
UPDATE: This promise has been fulfilled!
In 2008, a strong majority of Minnesotans voted to adopt the Clean Water, Land and Legacy Amendment. One-third of the state sales tax revenue derived from the Legacy Amendment is invested in clean water projects through the Clean Water Fund.
Every two years, Minnesota's nonpartisan Clean Water Council works with experts from across the state to craft detailed recommendations to the legislature on how to best invest the Clean Water Fund.
In 2017, the Council’s FY18-19 CWF recommendations, totaling $220.514 million, fell victim to a political compromise that raided $22 million from the fund to offset an equivalent funding cut in the environment funding bill. However, in the final hours of the session, an agreement in the final tax bill promised to repay the $22 raid should the state have a general fund surplus following a future budget forecast. We are relieved that the Legislature honored its word when the surplus was announced in late February.
As of now, the prospects for a supplemental Clean Water Fund bill are uncertain. Regardless, FMR and our partners will work closely with lawmakers to ensure that any additional funding allocated in 2018 follow the recommendations of the Clean Water Council.
How you can help
FMR River Guardians will be the first to know about opportunities to help advance this legislation during the coming 2018 legislative session. (If you're not one already, we encourage you to sign up! River Guardians are also invited to special events, including happy hours, where we discuss important legislative and metro river corridor issues.