WATER

Why New Jersey Needs Federal

Funding for Water Infrastructure
Fact Sheet • April 2009

O ur nation’s water infrastructure and economy are bound together. Aiding

the former will help the latter. Unfortunately, these days, both are treading
troubled waters.

In communities in New Jersey and across the country,

drinking water and sewerage systems are straining under
the weight of decades of federal government underinvest-
ment. In recent years, the State Revolving Funds were
financed at some of the lowest levels in history. For fiscal
year 2008, New Jersey received only $46 million, a mere
3.0 percent of the $1.5 billion that the state’s water and
sewer systems need.1

As the troubles with our water infrastructure mount, the

country’s economy slides deeper into recession. New
Jersey’s January 2009 unemployment rate reached 7.3
percent, or about 329,900 people, up from 4.6 percent a
year earlier. Nearly one in 14 people in the labor force are
now unemployed.2

Investing now in water and sewer systems to generate sol-

id economic growth can lead the state out of the recession.
Every federal dollar invested in infrastructure yields a
$1.59 return to our states.3 The National Utility Contrac-
tors Association estimates that for every $1 billion spent
on water infrastructure, nearly 27,000 jobs are created.4

The economic stimulus legislation passed by Congress in

February 2009 provides more money to water infrastruc-
ture than the country has seen in recent years, but this
one-time allotment cannot cure the problems plaguing
many communities. In fact, the bill provides water and
sewer systems with less than one-third of what the Envi-
ronmental Protection Agency estimates we should spend
each year just to maintain them.
New Jersey’s Water Infrastructure Funding Gap:
New Jersey’s water needs outpace its current ability to
fund projects by a large margin.
For the Drinking Water State Revolving Fund (SRF) pro-
gram, the state’s most recent Intended Use Plan lists 181
projects at a total cost of at least $625 million.5 In 2008,
the state received only $18.0 million in federal funding6
— enough to finance 1/35th of its needs.
Federal contributions to New Jersey’s drinking water
funding efforts have decreased by 35.5 percent since the
Drinking Water SRF was implemented in fiscal 1997 and
51.9 percent when adjusted for inflation.7
For the Clean Water State Revolving Fund program,
which goes toward wastewater infrastructure, the state’s
most recent Intended Use Plan lists 94 projects at a total
cost of $892 million.8 In 2008, the state received $27.8
million in federal funding9 — enough to finance 3.1 per-
cent of its needs.
Federal contributions to New Jersey’s wastewater fund-
ing efforts have decreased by 66.8 percent since the Clean
Water SRF was fully implemented in fiscal 1991 and 79.0
percent when adjusted for inflation.10
Job Creation: Fully addressing New Jersey’s currently
listed water needs of $1.5 billion would spur 40,457
employment opportunities, according to National Utility
Contractors Association estimates for job creation from
water infrastructure investments. That could put back
to work one out of every eight unemployed people in the
state.
Water Quality: According to EPA’s 2006 National
Water Quality Inventory assessments, 86 percent of the
state’s river miles, 73 percent of its lake waters and 89
percent of its bays and estuaries are impaired, as are all of
its oceans and near coastal waters.11
Beach Closings: A report by the Natural Resources
Defense Council shows that New Jersey experienced 142
beach closure days lasting six weeks or less in 2007, an
increase of 6 percent from the number in 2006. Aging
and poorly designed sewage and stormwater systems
cause many beach closures.12
Legislative Solutions: A comprehensive, long-term
solution is a dedicated source of public funding for water
infrastructure. This would help communities in New
Jersey and across America keep their water clean, safe
and affordable. It would unburden overtaxed state and
municipal governments of the cost of water infrastructure
repairs. Such an investment also would create employ-
ment opportunities and give our economy a much-needed
boost. Two legislative solutions exist.
Clean Water Trust Fund: A federal water infra-
structure trust fund bill will be introduced during
the current legislative session. As with the trust fund
for highways and airports, we should have a Clean
Water Trust Fund to provide municipalities with the
funding they need to keep our water safe and clean
for future generations. The trust fund should distrib-
ute money to publicly owned water and wastewater
systems. It also should ensure that funds be made
available for research and implementation of green
infrastructure and conservation practices.
National Infrastructure Bank: Related to the
trust fund is a proposed national infrastructure
bank to raise and distribute the money necessary
to upgrade drinking water and wastewater systems,
highways and other underpinnings of our nation’s
prosperity. Policy-makers should strictly limit private
sector involvement in water infrastructure to financ-
ing only. The public should maintain ownership and
control of public water and sewer utilities because it
does a far better job of management and operation.
Endnotes
1 U.S. Environmental Protection Agency, Office of Water.
“Tentative distribution of Drinking Water State Revolving
Fund appropriation for fiscal year 2008.” May 19, 2008; U.S.
Environmental Protection Agency, Office of Water. “FY 2008
Clean Water State Revolving Fund Title VI Allotments.” January
28, 2008; New Jersey Environmental Infrastructure Financing
Program. “Project Priority List and Financial Statement.” January
2009 at 25-26.
2 United States Department of Labor, Bureau of Labor Statistics.
[Press Release]. “Regional and state employment and
unemployment: January 2009.” March 11, 2009.
3 Schwartz, Bernard L. and Schwenninger, Sherle R. “A Public
Infrastructure–-Led Economic Recovery Program.” December
4, 2008; Zandi, Mark. Chief economist and co-founder, Moody’s
Economy.com. Testimony on Economic Stimulus For Small
Business: A Look Back and Assessing Need For Additional Relief.
U.S. House Committee on Small Business. July 24, 2008.
4 National Utility Contractors Association. [Press Release]. “New
CWC Report Demonstrates Immediate Economic Impact of
Water/Wastewater Infrastructure Investment?” January 28,
2009.
5 New Jersey Environmental Infrastructure Financing Program.
January 2009 at 26.
6 U.S. Environmental Protection Agency, May 19, 2008.
7 Ibid; U.S. Environmental Protection Agency, Office of Water.
“Distribution of DWSRF funds.” June 23, 2006; Sahr, Robert C.
“Inflation conversion factors for years 1774 to estimated 2019.”
Oregon State University, Political Science Department. January
16, 2009.
8 New Jersey Environmental Infrastructure Financing Program.
January 2009 at 25.
9 U.S. Environmental Protection Agency, January 28, 2008.
10 Ibid; U.S. Environmental Protection Agency, Office of Water.
“Clean Water State Revolving Fund Allotments.” April 4, 2007;
Sahr, 2009.
11 U.S. Environmental Protection Agency, Office of Water. National
Assessment Database. Available at www.epa.gov/waters/305b/,
accessed February 6, 2009.
12 Dorfman, Mark and Kristen Sinclair Rosselot. National Resources
Defense Council “Testing the Waters 2008: A Guide to Water
Quality at Vacation Beaches.” National Resources Defense
Council. 2008 at 76.
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