Proposal for $1 billion water infrastructure bond issue gets first Senate hearing

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02/10/2016

Proposal for $1 billion water infrastructure bond issue gets first Senate hearing

A rare bipartisan proposal that would see the state issue $1 billion in bonds over a decade to fund water infrastructure projects around the state got its first hearing in the Ohio Senate Tuesday.

Following the hearing on Senate Joint Resolution 3, Sen. Scott Oelslager (R-Canton), chairman of the Senate Finance Committee, said he will hold off scheduling future hearings until two key senators from opposing sides of the aisle have an opportunity to meet and develop a plan for moving forward.

But the future of the resolution depends on ongoing conversations between the lead sponsor of the resolution, Sen. Joe Schiavoni (D-Boardman) and Sen. Randy Gardner (R-Bowling Green), who chairs the Lake Erie Caucus.

In his sponsor's testimony, Schiavoni urged committee members to support the resolution, noting its bipartisan support. Republicans supporting the bill include Sen. John Eklund (R-Chardon) and Sen. Bill Seitz (R-Cincinnati). Nine Senate Democrats have also signed on to cosponsor the measure.

“This resolution is not the entire solution to our underground infrastructure needs, but it would be a significant step in the right direction,” he said. “The passage of SJR 3 could be the difference in how quickly projects can move forward and the timetable in which they are completed.”

Schiavoni introduced the resolution in September, saying it would create thousands of jobs and help local communities tackle major water infrastructure projects. At the time he said he was hoping to have the question placed on the March statewide election ballot, but that appears unlikely.

The resolution – if passed by the General Assembly and approved by voters statewide – would permit the issuance of no more than $100 million a year in general obligation bonds to fund acquisition, construction, improvement and other costs related to wastewater treatment systems; water supply systems; and storm water and sanitary collection, storage and treatment facilities.

Schiavoni in October presented the resolution to members of the Lake Erie Caucus, where it received a warm reception. But Gardner, a member of the Senate Finance Committee, said Tuesday he doesn’t believe the measure is ballot ready.

“I believe there’s still more work to do to involve various stakeholders – environmental groups, agriculture groups, business groups, tourism groups – to try to develop the best strategy. This could be part of that. It may or may not be,” Gardner told Schiavoni.

“I look forward to continuing to share information and working together. We do, I believe, have a few months to come together and work on a strategy if there’s going to be a ballot issue,” Gardner said.

Schiavoni agreed that “time is of the essence here. If we can come up with something everybody can get behind I think this is something that’s necessary now. I’m not married to every word of this resolution. I’d be happy to work with you if there are changes that you or other interested parties see fit and have that conversation.”

Sen. Michael Skindell (D-Lakewood) said the resolution is a good idea, but that $100 million a year is not nearly enough to meet statewide needs. “It’s a drop in the bucket, but it’s needed,” he said.

Schiavoni agreed that amount wouldn’t meet all local needs, but said the resolution “would be a great way to get the conversation started.”

Indeed, a report submitted to Congress recently by the U.S. Environmental Protection Agency estimates more than $14.5 billion would be required to fully fund needed storm water and wastewater projects in Ohio over the next five years.

The agency’s 2012 Clean Watersheds Needs Survey illustrates the capital funding needs for an approximate 5-year period in each state based on state and local planning needs to sustain water infrastructure and comply with the federal Clean Water Act.

Ohio’s share of the need stands out in two areas: combined sewer overflow correction and conveyance system repair. In those categories, Ohio was among states showing the greatest amount of financial need.

Ohio requires $7.5 billion in capital costs to prevent or control mixed storm water and untreated wastewater from discharging into water systems – the second highest of all states. That represents about 16% of the states’ total need of $48 billion. Only New Jersey’s needs are higher at $8 billion.

And when it comes to conveyance system repair, Ohio saw the third highest need nationally at $3.3 billion – or about 6% of the $51.2 billion in needs reported by all states. California and New York both showed greater need at $6.5 billion and $5.2 billion respectively.

Other Ohio needs include: