Reliable Water in the Digital Age: Examining Legislation to Strengthen Drinking Water Systems and Protect Ratepayers.
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House Energy and Commerce Subcommittee on Environment U.S. House of Representatives
Ihren Sitzungen folgenPaul Tonko
Without addressing these two issues, I unfortunately will not be able to support this proposal. Today we will also consider the majority's Water Cost Accountability Act. I want to be clear that I strongly support data centers paying the full cost of any water system upgrades or operations that they are responsible for. I do appreciate that we have identified some bipartisan consensus to ensure data centers do the same for their electricity use through the Ratepayer Protection Act. But state utility commissions do not typically regulate the rates of not-for-profit public water systems in the same way as investor-owned electric utilities.
So while I hope almost all of us can support the intent of the bill, I have questions about the approach taken in this draft. If we are serious about making data centers pay their fair share, I would like us to work together to make certain this legislation can withstand legal scrutiny and be implemented effectively. I appreciate the majority's interest in addressing water affordability by protecting Americans from data center-related water costs, but data centers are not the only reason that millions of Americans are struggling to pay their water bills. According to EPA, between 12 and 20 million US households lack affordable access to water services. And I can guarantee that if Congress reduces federal funding to support water infrastructure, these affordability challenges will get even worse.
Maintaining or even increasing funding levels for the SRF should not be ignored as foundational to protecting Americans from increases to their water bills. I would also suggest that we should go a step further by enacting a permanent water affordability program similar to LIHEAP. Ranking Member Pallone and I proposed a version of such a program in 2024, and I would urge the committee to consider it. Again, I would like to thank the majority for holding this hearing. I hope we can work together to build upon the success of the IIJA and advance bipartisan legislation to ensure safe, reliable, and affordable drinking water for all Americans.
And with that, Mr. Chair, I yield back.
Brett Guthrie
I now recognize the chairman of the full committee, the gentleman from Kentucky, Mr. Guthrie, for five minutes for an opening statement.
Thank you, Chairman Palmer. Thank you for holding this hearing and to our witnesses for being here, we appreciate you being here. This committee has led the way in advancing policies that support economic growth and protect our environment while ensuring United States wins the race against AI dominance over China. Today we will be considering two pieces of draft legislation. The first is a bill to reauthorize Safe Drinking Water Act programs and provide continued investment in our nation's drinking water infrastructure as well as expand cybersecurity protections.
The second bill, the Water Cost Accountability Act, will ensure that data centers, which are necessary to support our modern economy and win the AI race, are the ones responsible for paying the costs associated with connecting to public water systems. The rapid growth of data centers has sparked an important conversation across the country. This subcommittee has worked on legislation to support locating data centers at brownfield sites where there is already power and water infrastructure, but ultimately these decisions are up to local communities and the companies that want to make these investments. In my district in Hancock County, one company is making a four billion dollar investment to repurpose a former, just kind of sitting empty, smelter into a data center campus. So this brownfield site, not generating any economic revenue for the county, is expected to bring significant resources to the local schools and the growing regional economy when this takes place.
Every community should be able to choose whether data center development is right for them. Those decisions and the negotiations that come with them should remain where they belong, at the local level. This bill does not dictate those decisions to move forward, it simply provides an important protection for consumers. Today's discussion draft simply ensures a level of accountability that will lead to even further growth and development. I look forward to our hearing from our witnesses and I yield back.
Gary Palmer
Gentleman yields. I now recognize the ranking member of the full committee, the gentleman from New Jersey, Mr. Tonko, for five minutes for an opening statement.
Frank Pallone
Just all me? Oh, okay, I'm sorry. Thank you, Mr. Chairman. Americans are concerned about what data centers and Big Tech's push for more AI means for their communities, jobs, property values, and future. Electricity prices are skyrocketing, the electric grid is strained, our clean air and water are being polluted, and noise is wearing on communities' health and patience.
And people are just sick and tired of corporate special interests and Big Tech billionaires taking over their neighborhoods and threatening their utility bills, their air, their water, and their property. And unfortunately, these very real concerns are repeatedly swept to the sidelines, minimized, or ridiculed by President Trump and even Republican congressional leaders. Earlier this week, Trump posted on social media that communities that oppose data centers must want to end up being backwards and poor. Well, again, I think I'm kind of repeating what Alexandria Ocasio-Cortez said, but if Trump supports data centers so much, he should support building one in Mar-a-Lago, in my opinion. Meantime, here on Capitol Hill, Speaker Johnson and Republican Majority Leader Scalise have refused to bring up the Ratepayer Protection Act that passed unanimously out of this committee in July.
They cite concerns from Republican members. Imagine the House Republican leadership not wanting to support a bill that helps to ensure Big Tech pays for the energy these data centers consume. We'll see whether they'll support the bill that we're considering today once it gets out of committee. But that's the reality we're living in right now where Trump and House Republican leaders want to continue to give Big Tech free rein to build data centers with no federal guardrails. And that's the reality as we discuss the Water Cost Accountability Act.
While I support the intent of this bill to ensure ratepayers are not shouldering the cost of data centers, it is woefully inadequate to address the environmental concerns of data centers.
This is the environment subcommittee and we should be considering the real detrimental impacts that data centers are having on communities around the nation. We're seeing data centers running on dirty diesel generators that drive up pollution all while the Trump administration runs roughshod over the Clean Air Act. And then we see Trump's friends like Elon Musk, they don't care at all, they're not accountable at all. The reports of data centers being approved without any analysis of their water use even in water stressed communities. And now EPA is even trying to fast track the approval of chemicals like new PFAS for use at data centers putting our drinking water and the health of Americans at risk.
So we need real substantial federal guardrails in place to restrict their impact on air, our water, our power grid and on our monthly utility bills. If Congress fails to adopt strong federal guidelines, then a federal moratorium on data centers should be put in place. We're also considering the Safe Drinking Water Infrastructure Improvement Act, a discussion draft that would reauthorize several drinking water programs at the EPA. Unfortunately, this draft proposes drastic funding cuts for several grant programs that help communities access safe and affordable drinking water, including a $2 billion proposed cut to the Drinking Water State Revolving Fund or SRF. The SRF is our main federal funding source for drinking water projects and helps water systems pay for capital improvements.
For far too long our aging water infrastructure has been underfunded and while the bipartisan infrastructure law provided historic investments to address our infrastructure challenges, that funding was just a down payment on the $625 billion needed over the next 20 years and the Republican draft fails to address this need. So communities around the nation live with the consequences of this underinvestment from legacy lead service lines in my home state of New Jersey to the sewage pipe break right here in Washington DC. It's time we must bring our water infrastructure into the 21st century. That means helping water systems prepare for and adapt to our changing climate and increasing cyber threats, considering ways to promote energy efficiency and conserve water, removing all lead service lines once and for all and protecting communities from dangerous contaminants like PFAS that are plaguing our water systems. We also need a permanent water assistance program at EPA to ensure that all Americans can afford their water bills.
While this draft does include provisions I support such as reauthorizing resources for cyber resiliency, grant programs that help remove lead from drinking water and programs that help small and disadvantaged communities comply with safe drinking water requirements, it falls far short of the current need. I did want to say when I saw the secretary from the Vermont Agency of Natural Resources, I started my political career when I was at Middlebury College and we started an environmental organization and one of the things we did, I won't say what year it was, was we were deputized to go out and test the streams to see if they were contaminated because it was raw sewage at the time and we went to Ferrisburgh and Shelburne and that area and it kind of, you know, piqued my interest in the environment. So I wanted to mention that. I yield back Mr. Chairman.
Gary Palmer
We now concluded with member opening statements. I would like to remind members that pursuant to the committee rules, all members' opening statements will be made part of the record. We want to thank our witnesses for being here today and taking the time to testify before the subcommittee. The witnesses will have the opportunity to give an opening statement followed by a round of questions from members. Our witnesses today are Neil Bradley, Executive Vice President, Chief Policy Officer and Head of Strategic Advocacy, US Chamber of Commerce, Mae Wu, Founder and Principal, Health and Environmental Advising LLC, and Julie Moore, Secretary, Vermont Agency of Natural Resources and Vice Chair, Water Committee, Environmental Council of the States.
We appreciate all of you being here today. I now recognize Mr. Bradley for five minutes to give an opening statement.
Neil Bradley
Chairman Guthrie and Palmer, Ranking Members Pallone and Tonko, and members of the subcommittee, thank you for the opportunity to testify on behalf of the U.S. Chamber of Commerce. The U.S. Chamber has called on policymakers to prioritize policies that can help our nation achieve sustained 3% plus annual real economic growth. This reflects a simple truth. Growth is not an abstract idea. At 3% growth, an economy doubles in size in roughly 23 years.
That means more jobs, higher wages, stronger communities, and more opportunities for families and business in every region of the country. Reliable water is essential to economic growth. It supports public health, powers communities, enables manufacturing, sustains energy production, underpins agriculture and healthcare, and increasingly supports the digital infrastructure that modern businesses and consumers depend on every day. Today's hearing is timely because the nation is at an important inflection point. Demand for digital services, cloud computing, artificial intelligence, and other data-intensive technologies is growing rapidly.
Data centers are the backbone of that economy. They enable the tools that help small businesses reach customers, hospitals manage patients, manufacturers optimize production, energy companies operate more efficiently, and consumers access the services that are now a part of all of our daily lives. The question before policymakers is not whether America will need more digital infrastructure. We will. The question is whether that infrastructure will be sited, permitted, built, and operated here in the United States in a way that strengthens communities, protects ratepayers, addresses local concerns, and advances America's economic and technological leadership.
The Chamber believes that the answer to that question can and must be yes. We understand and appreciate the concerns that are being raised across the country around data center development, including with respect to water use. It is imperative that communities have confidence that their concerns will be heard and addressed. For data centers, that begins with early engagement among project developers, local governments, utility providers, and residents. Responsible siting should include careful assessment of water availability, system capacity, alternative resources, and affordability concerns.
Protecting ratepayers must be a core principle of water infrastructure policy. Household and small business customers should not bear an unfair burden or cost from economic development projects. This is true whether the project happens to be a data center, a manufacturing facility, a golf course, or an agricultural enterprise. At the same time, policymakers should recognize that large economic development projects can bring investments at such scale that they improve the operations and financial viability of local utilities. Blocking or delaying needed infrastructure can raise costs by discouraging investment and leaving communities dependent on outdated systems.
It's also important to understand that the stories one may hear about the data centers of even a few years ago do not describe the data centers of today. Thanks to technological innovation, data centers and other large-scale water users have been able to greatly improve their water efficiency. Continued innovation and deployment of new technology can extend this trend. Industrial water reuse is one of those most promising tools available. Federal policy should support wider deployment of reuse technologies including through investment incentives.
Finally, it's important to consider what will occur if, as a nation, we fail to build the infrastructure necessary for the digital economy of the future. A lack of data centers will not reduce the demand for artificial intelligence, cloud storage, or streaming services. It will only mean that demand will exceed supply. Economics 101 teaches us that when that occurs, prices rise. Small businesses and working families could in the very near future find that the tools that they need to become more efficient and grow their businesses or to prepare for the jobs of the future are simply unaffordable.
A new digital divide, if you will, that I am certain none of us want to see.
Further, America's competitors are not standing still. The countries that lead in artificial intelligence, cloud computing, and quantum technologies will shape the rules and economic opportunities of the future. People have honest questions and concerns about the impact of data centers on their own community, including on their water bill. The good news is that the answer to these questions should give everyone confidence that we can build the infrastructure we need in a way that helps, not hurts, local communities. I look forward to taking your questions.
Mae Wu
Thank you. I now recognize Ms. Wu for your testimony.
Good morning. Thank you and members of the subcommittee. My name is Mae Wu. I am a former deputy assistant administrator at EPA's Office of Water, and I've worked on drinking water issues for 20 years, and I appreciate the opportunity to testify today. Safe drinking water is fundamental to public health, to strong communities, to everyday life.
Americans have enough to worry about: putting food on the table, paying their bills, keeping their families healthy and safe. They should be able to turn on the tap in their homes and trust that the water will come out and that what comes out is safe. Water systems cannot meet this promise alone. They need a strong and sustainable federal partner, and Congress has the opportunity right now to provide that support. You know, my good friend just visited San Juan, and where he stayed, the water was only turned on for 45 minutes three times a day.
So if you miss the window and turn the tap on at 8:05 a.m., nothing comes out. So due to the convergence of the extreme drought conditions in San Juan and their aging water infrastructure, every day, hundreds of thousands of people have to calculate how much water to use and when to use it for drinking, for making baby formula, for cooking, for cleaning, for flushing the toilet. It's 2026, and we are rationing water in the US. And what's happening in San Juan is something that Americans should never have to go through, but right now, almost half of the US is experiencing drought, affecting almost 100 million people, and many of these same communities also have drinking water infrastructure that is at or nearing the end of its useful life. You know, just here in DC, we only have a one- to two-day buffer in available drinking water in storage, so a sewage spill like with the Potomac Interceptor upstream of our drinking water intake or a bad drought means that we could be rationing water like they are in San Juan too.
So over the next 20 years, we will need somewhere between $625 billion up to potentially $1.6 trillion to modernize and make water infrastructure secure. And even with the significant infusion from the Bipartisan Infrastructure Law, federal funding for drinking water infrastructure has not kept up with the need. As a result, more local funds are being used and the cost falls to ratepayers and translates into higher monthly water bills. People served by small water systems often end up with higher monthly water bills because the ratepayer base is so small. And bear in mind, 97% of all our water systems are considered small systems in the US.
So more federal and state funding would relieve the pressure on many local governments and their residents.
The drinking water SRF is considered one of the most effective tools that Congress has ever created to fund public investment in water infrastructure. And investing in water pays dividends both in protecting public health and in building community wealth. In fact, for every one dollar invested, you generate about two dollars and sixty-three cents in economic output. That's more than double. So cutting the SRF authorization in half will only hamstring states and utilities who are trying to provide safe drinking water.
And it sends a message that Congress is backing away from helping Americans, especially those living in small, rural, and disadvantaged communities. Instead, Congress should reauthorize the SRF to at a minimum three point two five billion per year, but even better would be raising those levels to ten billion dollars a year, which really only flicks about ten percent of the total need, but would help make a dent in that need. In addition, Congress should be creating a permanent federal low-income water assistance program. The temporary program created in twenty twenty-one provided relief to one and a half million people across almost every state in the nation. And nearly seventeen thousand utilities participated in that program, with almost half of those from small systems serving mostly rural communities.
This program provides a good model for how Americans, how you can help Americans who need assistance to maintain drinking water access. To protect families from lead, Congress should reauthorize the lead service line replacement funding at three billion dollars per year so cities can continue to remove and replace lead pipes. Congress should also reauthorize the funding for emerging contaminants, including PFAS, to at least four billion over five years, because removing PFAS and those types of chemicals from our drinking water will save thousands of lives and prevent tens of thousands of serious illnesses. Water systems face a lot of challenges: providing safe water in the face of severe weather, cyberattacks, increasing demand, and they have to do it all while keeping bills affordable. The challenges are complicated, but the answer is very simple and old-fashioned: it's funding.
Thank you, and I look forward to your questions.
Julie Moore
Good morning, Chairman Palmer, Ranking Member Tonko, Chairman Guthrie, and Ranking Member Pallone, as well as members of the subcommittee. Thank you for the opportunity to testify today. I'm Julie Moore, Secretary of the Vermont Agency of Natural Resources and Vice Chair of the Water Committee at ECOS, the Environmental Council of the States, which represents environmental agencies in every state, DC, and the territories. So I bring the perspective not only of a small, rural state, but also as a member of ECOS. States are the primary implementers of the Safe Drinking Water Act's regulatory and funding programs, a partnership with EPA often called cooperative federalism.
And we're eager to work on a bipartisan basis with the committee on both current challenges and those that lie ahead. Timely reauthorization and strengthening of the Safe Drinking Water Act's programs, especially the hugely successful Drinking Water State Revolving Fund, is a priority for ECOS and the states. The pipes, treatment plants, people, and programs under the Safe Drinking Water Act protect not only public health, but the environmental and economic vitality of our communities, and funding levels should be as robust as possible. Aging infrastructure, lead, PFAS, and cyberattacks are putting enormous pressure on systems and states. Funding needs to be sufficient and flexible enough to help address these challenges without forcing communities and ratepayers into debt they cannot afford.
We encourage you to treat this bill's one point one two billion dollar DWSRF reauthorization as a floor, not a ceiling. This is fundamental for water affordability. Water infrastructure funding demand continues to far outstrip supply, even after the largest federal investment in a generation. In Vermont, project demand this year is one hundred and eighty-five percent of what it was in just twenty twenty-one, in part because ARPA and IIJA signaled that substantial, affordable capital was available for these projects.
Here's why continued robust SRF funding matters right now. States sit between two obligations that are getting harder to reconcile. Communities are struggling to make infrastructure investments, and they need grants and loan forgiveness as part of this. But forgiven loans don't come back to the SRF to lend again, and so states have a fiduciary duty to protect the fund's long-term solvency. Many states won't issue a loan if it pushes a system's rate above 1.5% of median household income because at that point, default risk to the state's loan fund is real, which means often communities with the greatest need for infrastructure investment are being pushed towards a tool they really can't use.
Two forces are cutting into that grant capacity for states right now: the sunsetting of the IIJA supplemental funding and community project funding, or earmarks, which come off the top of SRF appropriations before states see the money. Earmarks have the practical effect of shrinking both the subsidy pool available for loan forgiveness and the set-asides that fund the state staff who provide direct technical assistance to the systems. Every state is impacted, regardless of whether it receives earmarks. Nationally, that's cost roughly $740 million in set-aside authority over the three most recent years. For Vermont, it's about $2.5 million a year, which would have funded work like asset management plans for municipal water systems, leak detection work, and the evaluation of unknown service lines for lead.
It feels a little bit like a death spiral. The neediest systems get offered a tool they can't use in the form of a loan or get passed over to protect the SRF while their infrastructure deteriorates and the eventual costs—financial, environmental, and public health—grow. I urge this body to direct EPA to calculate set-asides on the pre-earmark allotment, a solution already extended to the tribal set-aside. More fundamentally, CPF should be layered on top of the SRF appropriations, not deducted from them, so states can anticipate what they have to deploy each year as we work with communities to move their projects to implementation. I'll close on cybersecurity.
We welcome this bill's attention to it, and yet the resilience funding is too small to harden the 52,000 community water systems nationwide. And frankly, capital is only half of the picture. Training, assessments, and emergency response planning really matter in this space too. We'd urge a plus-up in dedicated state funding as well as to EPA for technical assistance, either provided directly or through the many outstanding groups that provide this support to small systems across the nation. We also encourage the committee to ensure EPA coordinates closely with states and other federal agencies such as CISA in this priority area.
Thank you for the opportunity to testify this morning on behalf of Vermont ANR and ECOS, and I'm happy to answer questions or follow up as needed.
Redner 16
Thank you all for your testimony. We will now move into the question and answer portion of the hearing. I will begin the questioning and recognize myself for five minutes. Mr. Bradley, has the Chamber done any analysis of how investments in local infrastructure projects support creation of domestic manufacturing jobs across the country?
We have studied recent investments and what they've done to local communities in terms of tax base, job creation, etc., but not did any longitudinal study.
Absolutely.
Redner 16
Appreciate that. In regard to the water, there's a lot of discussion about the data centers, and I understand that you're here to talk about that.
Gary Palmer
Have you done any kind of comparative analysis to compare other developments, water usage, and other infrastructure, like golf courses use an average to 100, 110 million gallons per year? It's all evaporative.
Neil Bradley
Yes, you'll see new data centers, like the one Microsoft just announced, that uses less water from the system than the average golf course.
Gary Palmer
Well, it takes for a medium-sized data center, it takes somewhere in the range of 400,000 to a million gallons one time. For a hyperscale data center, it could take up to 25 million gallons, which would be a quarter of what a golf course used in one year. But you fill it one time, you never have to refill it unless something catastrophic happens. But shouldn't the data centers be required to pay for that?
Neil Bradley
Absolutely, data centers should be required for what they use out of the system. By the way, that provides them a very strong incentive to innovate to reduce their use. That's why they're moving to closed systems. That's why they're even in many instances moving away from water, the ability to cool in non-water liquids that can be recycled through a system.
Gary Palmer
And reading your testimony last night, I circled some things that I think you were referencing a value proposition. Could you define that a little bit better?
Neil Bradley
Absolutely, that when we think about, these are economic development projects, right? A data center is a large-scale economic development project that brings both benefits to the community and costs. Good economic development, whether it's a data center, a manufacturing facility, an office building, generates more in economic activity for the community than what it costs. When you look at data centers, that's what they are routinely doing. Loudoun County, not far from here, $26 in return to the county for every dollar of cost to the county.
Gary Palmer
Well, I think there's more to it than that. And if you've done any analysis of what a data center actually provides in terms of the value proposition to the average citizen, if you could provide that to the committee in writing, we would appreciate it. Secretary Moore, we've spent a good bit of money on specific water infrastructure projects rather than just providing the funds to capitalize state revolving loan funds. Can you speak to how that, such directed spending, impacts the states as well as the long-term solvency of the revolving funds?
Julie Moore
Sure. So there are critical investments being funded in water infrastructure through earmarks and congressionally directed spending. Those, but because those dollars come off the top of the allocation that would otherwise come to the state revolving fund, they aren't returned to be revolved again. And so we've seen a, or are estimating a long-term diminishment in Vermont alone of about $150 million of revolving loan capacity over the next 20 years as a result of dollars going out to communities as grants instead of loans. I'm happy to follow up with some additional detail on that if helpful.
Redner 18
That would be very helpful. I grew up in a rural area and a lot of my district's rural. Can you talk about some of the unique challenges rural areas face in developing and maintaining drinking water infrastructure and how this draft reauthorization bill can help?
Julie Moore
And one of the biggest challenges they face is a limited rate base or ratepayer base in order to be able to finance that work. So the low-cost financing tools as well as the ability to provide subsidies through the State Revolving Fund program are incredibly important. We often see communities building complex funding stacks in order to be able to implement a project at a price their ratepayers can afford, seeking grants, working with the Northern Borders Regional Commission in addition to moneys that are available through the State Revolving Fund.
Sure. We also are replete with rural systems in Vermont.
Gary Palmer
Thank you. And now I recognize the ranking member of the committee, Mr. Tonko, for five minutes for his questions.
Paul Tonko
Thank you, Mr. Chair. At past hearings, I have raised my concerns about the impending funding cliff at the end of this year with the expiration of the IIJA supplemental funding. There is a serious risk of going back to a time when fewer water systems can access funding to carry out long-overdue infrastructure improvement projects. So, Ms. Wu, do you share these concerns about what looks to be a drastic reduction in SRF money for the next fiscal year?
Redner 12
Yes, absolutely. We have a growing need. We don't need to cut back on funding at this point.
Paul Tonko
And in more specific terms, what would the loss of that money mean for water systems and their customers?
Mae Wu
I mean, it just means a lot of the systems that need funding to be able to upgrade their infrastructure, to fix those leaking pipes, to fix those broken water mains, won't be able to or have to put them off for longer, which means that their residents are at more risk for having contaminated water or, you know, break in their service.
Paul Tonko
And so given this impact, Ms. Wu, do you think it is appropriate that the Safe Drinking Water Infrastructure Improvement Act would reduce the SRF's authorization level by over two billion dollars annually?
Redner 15
And Ms. Moore, and thank you, by the way, for informing me of your roots in Altamont, deep in the 20th Congressional District and the Guilderland school system. What about the needs in a state like Vermont?
Yeah, our systems are small. There are over 400 public water systems in the state of Vermont, many of which are run by volunteers and volunteer boards, and they are incredibly challenged to access the level of funding required to meet some of the modern Safe Drinking Water Act requirements. In addition, the technical assistance provided by the state is critical to their successful implementation because they often lack the administrative capacity to support the complex projects that really are integral to high-quality drinking water.
Redner 14
So we focused on these recent higher funding levels. What have those higher levels allowed you to support in terms of projects that may not have happened otherwise?
Julie Moore
They have been enormously impactful on the ground in Vermont. We've been able to use ARPA dollars to great effect in terms of supporting manufactured housing communities and low-income Vermonters with private wells and septic systems, and combined that with high levels of investment through the Drinking Water SRF into some of our smallest and most rural systems. The increased capacity for loan forgiveness has really helped move those projects forward. The average community in Vermont has fewer than 2,500 residents, and often the rate base for these systems is less than 400 connections. So the ability to provide subsidy and loan forgiveness is critical.
Paul Tonko
Thank you. And I also mentioned that the majority's proposal does not reauthorize the Public Water System Supervision grant program. Again, Ms. Moore, can you explain the importance of this program and how do these federal resources help a smaller state like Vermont fulfill its Safe Drinking Water Act requirements?
Julie Moore
Sure. As I indicated, oftentimes our communities are relying on the state to provide that technical assistance and support to them in evaluating needed projects and helping understand what work needs to be completed by what timeframe. The PWSS grants coupled with the set-asides in the State Revolving Fund program fund our staff, who are really the technical experts that communities rely on in developing these projects. And so any reduction in that capacity means either communities will have to contract for that kind of support or may let that need go unfulfilled.
Paul Tonko
Again, with a very small base of funding from the local level. Ms. Wu, I'm guessing that during your time at EPA you worked with many state government partners. If we want to continue this model of cooperative federalism to implement our nation's environmental laws, do you agree that federal resources such as the public water system supervision grant program are necessary to support state administrative capacity?
Mae Wu
Yes, absolutely. The partnership between the states and the federal government is so important to implementing the Safe Drinking Water Act appropriately. And so, providing more funding for that is really important.
Paul Tonko
Right. And our drinking water challenges are getting more complicated: new standards for emerging contaminants, cybersecurity, resilience planning, and an aging workforce. States need to have sufficient and qualified staff to carry out this work and provide the best technical assistance possible to water systems. I know Ms. Moore isn't alone in her views. The Association of State Drinking Water Administrators sent a letter to the subcommittee for the hearing record stating, "Public water system supervision funding is the backbone of state implementation of the Safe Drinking Water Act."
"While infrastructure investments through the drinking water safe revolving fund are essential, those investments cannot succeed without adequately staffed and resourced state programs." And that's direct from their letter. I hope we can work together to make certain both the SRF and the state grants are reauthorized at levels that reflect the tremendous needs out there and challenges. Mr. Chair, before I yield back, I ask that the letter I just cited from ASDWA along with four other letters from systems, NGOs, and others supporting sustained federal infrastructure funding be entered into the record.
Without objection, so ordered.
Thank you, and I yield back.
Brett Guthrie
Gentleman yields. Chair now recognizes the gentleman from Kentucky, the chairman of the full committee, Mr. Guthrie, for five minutes for his questions.
Thank you, Mr. Chairman. Thanks for being here. And Secretary Moore, I have the same situation in Kentucky in some of my communities to where probably 50, 60 years ago we must have had a big bond issue or something because we have a lot of water plants, a lot of water lines that are at their breaking point. And now it's extremely expensive, usually about 40 million dollars for a water plant. You have low rate, so we have low-cost loans, we're talking about what you just said, subsidies, and then most of our congressional direct projects, just not enough money to do them as quickly as we need to do them.
And so the problem is the shrinking load of the people requiring in rural part of Kentucky. And it just seems like maybe the data centers in a way could be a benefit. So they come in and they don't use as much water as they used to, but it brings a new load that can one, pay their cost to hook up, they should pay for everything they do, but also share in this the general maintenance and the rates should help if you have a small community and then a data center uses as much water as the rest of the community combined, that seems like that would share the cost. Do you think that's possible in Vermont as well?
Julie Moore
I think the scale of our small communities is such that a data center would simply dwarf the water usage by that existing community. Generally our systems have, I believe, an average of 400 or fewer connections. So we're talking very small systems.
Brett Guthrie
But if you've got to build a 40 mil, that's my point. So if you've got to build a 40 million dollar water plant for 400 people, that's all, their rates would be astronomical. But if you've got 400 people and a user that's also going to help pay for that, it could actually make it cheaper for them, right?
Julie Moore
It could be. I mean, I think there's a lot of "it depends" in that setting and just the water, just my familiarity with the water supplies, often which are groundwater based, it may not have the capacity to actually supply.
Brett Guthrie
Well, every community has to make a decision, but if the bigger the load in a water system in general, whether it's a data center or not, usually it's cheaper per person in the system, right?
Redner 19
There is some amount of fixed costs. And so having a larger user base in a water system has value in bringing down the average cost to individual users.
Neil Bradley
I think that's exactly right, Mr. Chairman. Whether it's a data center or a manufacturing plant or a large agra-enterprise, having a large user provides scale, which happens to be particularly important for...
Brett Guthrie
And it has to be environmentally sound, has to make sure other people aren't sharing their direct costs, but it does give scale.
Neil Bradley
It provides scale, and you're already seeing this in even in electric utilities, for example. In Indiana last week, it was announced that the utility is reducing by 5% the average electric utility charge directly attributable to the fact that they're covering more of their fixed costs with data centers. And so, whether it's a data center or another large-scale user, it can help solve our problem.
Brett Guthrie
So, Secretary Moore, also in my area, we have everybody's worried about a cyberattack. So you've got these small, I have a lot of small water systems, so you have cyberattacks, and the other thing is just the aging workforce. I think you see it a lot, particularly in our water systems for or our public utility systems, particularly our water systems. I know I think Vermont must experience, the rural America's experiencing that, so I think we share that. So how does the draft legislation address these issues, and what can be done to improve cybersecurity and workforce development?
Julie Moore
Yeah, certainly the attention the bill pays to cybersecurity is welcome. We often joke in Vermont that our biggest line of defense is the fact that many of our smallest water systems aren't actually hooked up to the internet, and that is their primary defense mechanism. And that's not a sustainable solution, clearly. So continuing to make strategic investments in cybersecurity, not just in the physical infrastructure, but in the training for those water operators is critical. And I agree, we are facing a gray tsunami when it comes to the folks operating our water and wastewater systems statewide as well as across the country.
Vermont has partnered with the US Department of Agriculture Rural Development to create an apprentice program that's being administered by Vermont Rural Water. It's something that's seen great success. We understand that that funding may ultimately be reduced, which would be unfortunate, but we've been able to place upwards of a dozen at this point new staff into key systems around the state where they had actually had gaps in coverage in terms of certified operators.
Brett Guthrie
Thank you. And I'll just close with, just like rural and beautiful rural Kentucky, Vermont's a stunningly beautiful place and enjoy visiting, and thank you for being here. And I yield back.
Redner 23
Gentleman yields. Chair now recognizes the ranking member of the full committee, Mr. Tonko, for five minutes for his questions. I mean, Mr. Pallone.
Frank Pallone
I don't have the authority to promote anybody, but I do promote you, sir.
And often these projects, like replacing lead service lines or fixing leaky pipes and cleaning up PFAS contamination in water, can be costly. All right, thanks a lot. So I wanted to say that the Safe Drinking Water Act tasks EPA, states, and water systems to work together to provide safe drinking water. However, investments in our drinking water are critical to public health and the functioning of our economy. So in witness testimony, we see broad agreement on the importance of reliable water and the need for sustained and strengthened investments in our infrastructure.
And I agree, because water is critical to every aspect of our lives. Unfortunately, federal investments have not kept pace with the need. So I have three questions of Ms. Wu, and I'd like to get to all three. First is if we continue to underfund the State Revolving Fund and drinking water infrastructure projects, what does that mean for American families?
Mae Wu
I mean, it means that their monthly bills could be going up to pay for water, if they can afford them. It means that they risk that the water coming out of their tap may not be as safe as they want it to be. It means sometimes they may turn on the water and they may turn on the tap and water doesn't come out. There's a lot of risk there.
Frank Pallone
All right, and I agree, obviously.
That's why I fought hard, and I think we all did, for the bipartisan infrastructure law for the SRF and targeting funding to address lead and PFAS contamination. But instead of sustaining these investments from the bipartisan infrastructure law, this Republican discussion draft would dramatically cut the SRF. And Americans are already struggling with the cost of basic necessities and they're seeing their water bills increase significantly. And I think they're going to suffer the consequences of these cuts that are in the draft. But my second question, Ms. Wu, some suggest that rolling back drinking water protections would make water more affordable.
Do we need to compromise on drinking water standards to provide safe, affordable water to communities?
Mae Wu
No, absolutely not. It shouldn't be a two-tier system. If you can afford the water, you get cleaner water. Everybody should have safe, affordable water. And, you know, it's an important part of just protecting public health is making sure that the water that comes out doesn't have PFAS in it or your pipes aren't delivering lead so that your kids can have a better shot at, you know, a good, healthy future and that you aren't dealing with more medical bills because somebody in your family's gotten cancer or somebody there has a, you know, heart disease or lung disease caused by these contaminants.
Frank Pallone
All right, thank you. And then my third question is, when thinking through ways to address the affordability challenges facing Americans, could a permanent water assistance program play a role as we have for some other utilities?
Mae Wu
Yes, absolutely. I think the temporary program that was in place helped more than a million families already, but it was temporary. And so, you know, a permanent one will go a long way to helping all the families who are struggling with their monthly water bills.
Frank Pallone
I appreciate that. You know, what I see happening with a lot of people is they're afraid to drink the water, right? So, I mean, look at here today, we've got the bottles, right? I still drink the tap water. Maybe I'm crazy for doing it, but I still do.
And I do think it's, you know, that we owe it to the American people to ensure they have access to affordable and safe drinking water. And I hope we can work together towards a bipartisan bill. Obviously, Mr. Chairman, I've been critical of this draft, but it's only a draft. So hopefully we can improve the levels of funding and address some of the concerns that the panel has brought up today in terms of drinking water issues facing our country. I mean, I know that even in my district, we've used the money from the bipartisan bill and state sources of funding, you know, to remove lead pipes.
A lot of the older, a lot of the towns in my district have had, you know, had pipes that went back, you know, a hundred years or so, right? And so it costs a lot to replace them. And that's why we need a more robust safe drinking water program. And even this draft isn't adequate, but we still have time to improve it and hopefully we'll do that on a bipartisan basis. And thank you.
I yield back, Mr. Chairman.
Gary Palmer
They've called votes, and rather than recess, I want to be sensitive to people being able to make their flights. So we're going to continue the hearing and I would encourage members who are a little bit down the line for asking questions to go vote and come back. And we'll just keep the hearing going so that we can finish this in a timely manner and people can make their flights.
The chair now recognizes the gentleman from Georgia, Mr. Carter, for five minutes for his questions.
Earl Carter
Thank you, Mr. Chairman. And thank all of you for being here. Extremely important subject. You know, I have the honor and privilege of representing the entire coast of Georgia, and we've been very successful in economic development and attracting new investment in Georgia. Thirteen years in a row, number one state in which to do business.
So we're very proud of that, and we've worked hard at that. Look, data centers are a concern, and I believe that data centers can be very good for our communities. They can bring major private investment, they can create jobs, they can strengthen the tax base, and they can create new opportunities for local workers and businesses. But, but, the projects that are going to be successful over the long term are the ones that operate as partners with the communities that host them. I know this firsthand.
In another life, I was a mayor. I recognize how important local jurisdiction is, and I recognize that, and I encourage the data centers, not after the fact, but before the fact, to please work with the local communities. This will help us all. Georgia's already been working through a lot of this. We've, on the electrical side anyway, the basic principle is pretty straightforward: when a new large user creates the need for new infrastructure, that customer should bear the cost associated with serving that new demand rather than shifting those costs onto families and small businesses.
The PSC in Georgia has already addressed this, and we've done that. The same can be true for water cost and accountability. Mr. Bradley, let me ask you, from an economic development perspective, how important is that principle of cost responsibility to maintaining public support for large projects like data centers?
Neil Bradley
Congressman, I think it's essential. I think that I've spoken to the data center developers myself and said, you know, the approach that you've taken in the past of treating it like a normal economic development project where maybe you wouldn't have had as much public engagement just won't work anymore. And so people have questions. The good news is, is you have answers. You should be transparent and open about what you're doing and provide those answers.
I think one of those answers has to be, to your point, that they're going to bear the cost for the incremental things that they're adding. And then we also ought to look for them to provide the large-scale benefits that inure to the whole system that can actually help ratepayers.
Absolutely before the fact.
Earl Carter
How can we make sure that data centers pay for the infrastructure that they need without making it harder for communities to attract new investment?
Neil Bradley
This is a principally a local-level decision, right? Each data center is different, how it's structured, its size, what it's going to use. Each community is different in terms of its capacity.
That's exactly right.
Neil Bradley
And so I think these really have to be local discussions that are transparent to the public, but the principle that should guide those discussions is one that every large user should bear the cost of their thing. And I think what we see around the country is that's what local governments are insisting on, and that is what data center developers are committing to provide.
Earl Carter
And let me emphasize that word you used: transparency. Extremely important. You know, let's shift now to water. Many communities in Georgia, particularly smaller and rural communities, are trying to maintain aging drinking water infrastructure with limited staff and resources. You mentioned yourself, Secretary Moore, in what y'all are doing.
And cybersecurity is certainly important. Of course, if you're not on the internet, it ain't that important. But nevertheless, the Safe Drinking Water Infrastructure Improvement Act would continue assistance for small and disadvantaged systems while expanding cybersecurity eligibility and workforce training. Secretary Moore, for smaller water systems, what would make these federal programs genuinely useful on the ground? What's the practicality here?
Julie Moore
Sure. I think each one of our systems is unique, not dissimilar to the conversation you were just having around data centers. And so having trained staff on the ground able to provide direct technical assistance to those smallest systems is really critical in helping them put up the necessary defense to withstand a cybersecurity attack.
Earl Carter
Absolutely. Let me be clear again. Georgia is growing and we are investing and we have companies investing in Georgia. Growth works best when the company, the utility, and the local community are at the table together, not after the fact but before the fact. When infrastructure needs are planned out upfront, the costs are allocated fairly and the people who already live in that community, already there, they see the real benefits from the investment.
This is what we need to remember. Thank you all for being here on this very important subject. Thank you, Mr. Chairman, for convening this and I yield back.
Gary Palmer
Gentleman yields, chair now recognizes the distinguished gentleman from California, Dr. Ruiz, for five minutes for his questions.
Raul Ruiz
Thank you very much, Mr. Chairman. You know, I represent California's 25th district, it's the southeast corner of California. It's very dry, it's a desert, there's extreme heat, 115 degrees. You know, California's been struggling with drought every once in a while. We're in the Colorado River Basin and we're facing mandatory cuts.
A lot of our livelihoods depend on water in the agricultural industries. And we want and there are data centers who want to come in and they want to come in to rural areas because land perhaps is more abundant and cheaper and they may a lot of utilities are cheaper in that area for them as well. But of course, there is a lot of reservation, not only in terms of the cost of water to the local residents, which by the way are amongst the most impoverished in the state of California with one of the lowest median household incomes and one of the highest unemployment rates up to 14% still in that entire county where the national average is 4%. But also in terms of the scarcity of water and what that may look like not just in the current snapshot but in the future. And so there's a lot of concern with costs, with scarcity and consumption, especially during droughts in case the Colorado River has more mandated cuts, but also in terms of the quality and the cleanliness of the water and potential contamination from data centers.
And so we have to figure out how do we first and foremost protect the people that live in those communities because I can almost guarantee you that the owners of these data centers aren't going to live in these communities. And so one of the things that we're working on in my office is how do we create more transparency in the reporting to anticipate what these data centers will do in these local communities. We looked at some reporting parameters like anticipated water consumption, including maximum daily, maximum monthly, and average annual water use estimates. What else should we be requiring reporting beforehand so that we can have better accounting? Should we include peak water usage during the hottest parts of the days, Ms. Wu?
Mae Wu
Yeah, you took the words right out of my mouth. I was going to say, especially because you live in such a hot area, when you see that peak demand, it is during those hottest days. So I think that's more important than just the average use or even like what they think they'll use on an annual basis, is what's that peak? Because your water utility is going to need to build its infrastructure to meet that peak need, not to meet whatever the average need is. So that's a really important area.
But also, like, you know, the chemicals that they're going to be using, what's going to get into the water as the data centers using the water? Because, you know, there may be contamination from some of the things that they'll have to use as they're cooling the water. So there may be corrosion inhibitors, there might be biocides, things like that I think are also really important.
Raul Ruiz
I'd like to explore more, what are the dry cooling methods that you would think are the safest for communities, for data centers to use?
Mae Wu
It's a big question. I'm not a data center expert. I think that there are a lot of technologies that are probably in use now, but are being, you know, there's research and development on that. And hopefully they're thinking about both, you know, lower water use, but also what the potential human health impacts of whatever those technologies are.
Raul Ruiz
Mr. Bradley, you mentioned some of those earlier. You're with the US Chamber representing these businesses. So I'd like to know what are the safest dry cooling methods that don't rely on water, but that pose the least or no risk to the environment or to the water itself?
Neil Bradley
Congressman, you have a number of innovations that are occurring, including not all are appropriate for every place, though. For example, in some areas you can use air cool. That is more difficult in a hot, humid environment. You have now submersion systems where essentially the data center elements are submerged in a non-conductive liquid. That liquid is part of a closed system.
It's not your normal drinking water. So it's a closed, non-conductive system and they use that liquid to get higher efficiencies in the cooling. And so those are innovations that are kind of growing and occurring, but it's really going to depend on the type of data center and, you know, the type of environment that you're operating in, what would make the most sense.
Raul Ruiz
Thank you. I think the first and foremost, we need to protect people. We need to protect their drinking water, the air they breathe. Let's figure that out so that then we can figure out how we can dominate in the AI space, okay? Thank you.
I yield back.
Bill Johnson
Thank you very much. The gentleman yields back and the chair recognizes himself for five minutes for questions. Mr. Bradley, welcome back. Good seeing you again. And you know, just to follow up on your last comments, I was out at one of our corporations in the state of Ohio, they're working on that being able to submerge everything into that liquid.
So it's almost like thinking about your cooling system in your car. So it's there would be no water. So it's it's quite a system. But if I could start with my questions with you, because I think one of the things that really stood out in your testimony was when you talk about wanting to make sure that we're protecting the ratepayers out there. And you know, you say that's a core principle.
Could you just go into that a little bit more? Because again, we, you know, what we passed here in this committee was the Ratepayer Protection Act to make sure that, you know, on the electric side, that ratepayers are being protected. But would you like to go into that? Because I think it's really, really important to this committee.
Neil Bradley
Congressman, it's great to see you again as well. Um, yes, the the principle's pretty simple, right? So if you have a large scale user, and from our perspective, that would include a data center or a large manufacturing facility or even a large office campus, you have a large user either of electricity or water, they ought to pay the costs that they are imposing on the system for those connections.
Now, that principle is simple. The implementation of it can be a bit more complicated because as we've discussed earlier, for example, the scale that a large user can bring to the system can actually help offset fixed costs for the other ratepayer base. And so if we're truly squaring up both sides of the ledger, we're looking at both the costs that they're imposing on the system, both one-time costs for the hookup, then operating costs, but we're also looking at what they contribute to the system. Local utilities, local municipalities have a lot of expertise in working with project developers to figure that out, but I think those are the questions that will have to be worked out on a project-by-project basis to implement the principle that you have correctly identified.
Bill Johnson
Well, thank you. Let me ask Secretary Moore. You talked about the vulnerability of our systems out there, and one of the great things about being in positions that we're in, I actually go out and I'm looking at our water and our sewer systems out there, but also the vulnerability out there. Could you go into a little bit on because on the cybersecurity side, but also on the physical facility, that the physical side, that the threats are out there and what we need to be doing out there with our water systems?
Julie Moore
Yeah, the challenge is really abound for our smallest water systems in particular. They often lack the technical, financial, and managerial capacity to meet many of the sort of modern challenges that are befalling them alone. And that is why having robust state technical assistance, as well as through our partner organizations like RCAP and the Rural Water Associations, is incredibly critical to making sure that we have the resources and are providing them to these systems so that they can maintain that safe, high-quality, and affordable drinking water that their customers expect.
Bill Johnson
Well, thank you. Ms. Wu, as we talk about upgrading our systems and the dollars that are out there, the other thing when I'm out at our water plants across the state of Ohio, we talk about needing the money for just the physical plant, but the other issue that we're going to be facing in the future, maybe you did what you saw when you were at EPA, is finding the technicians out there and the people to run the facilities. And that's something that a lot of the folks, I guess you might say, are aging out. They're getting ready to retire, and we just don't have those people coming up behind. Could you address that issue because again, we can have all the great plants out there in the world, but if we don't have the people, we've got a problem.
Mae Wu
Yeah, absolutely right. Workforce development is a big, huge issue, especially in these smaller communities where folks are leaving and you don't have somebody who's certified to operate. And I think there are a lot of great programs out there in community colleges. We need more and fund more of those to have trainer certifications, operator training. There's also a lot of things thinking about like reciprocity between states so that people can move to different places and continue and keep that certification and work there.
And then it's, there's actually a real need on data because it's hard to see a shortage need in a specific place when your data shows you like nationally we're okay with how many engineers we have or things like that. But if we had more water-specific data with like the Bureau of Labor Statistics, then we would have a better sense of like what the real need is in the water arena. But there are a lot of programs and there was an interagency workgroup that had looked at water workforce needs. So there are a lot of programs within a lot of agencies I think that could be also better funded to help build out that workforce.
Bill Johnson
Well, thank you very much to our witnesses. My time has expired, and the chair recognizes the gentleman from New Jersey, five minutes for questions.
Robert Menendez
Thank you, Chairman. Lead poisoning from drinking water is a preventable public health crisis, and we know the solution: getting lead pipes out of the ground.
That is why the Infrastructure Investment and Jobs Act provided $15 billion through the Drinking Water State Revolving Fund specifically for lead service line replacement. New Jersey has put those funds to work to protect children and families from health harms like developmental delays, learning difficulties, and seizures. But our state needs billions in additional investment to remove all lead pipes. We should meet this moment and get the lead out. Yet Republicans have instead proposed cutting the State Revolving Fund authorization by more than $2 billion and refused to extend the IIJA's dedicated lead pipe replacement funding.
Ms. Wu, what would cuts of this magnitude mean for communities already struggling to afford lead service line replacement?
Mae Wu
It would mean that if they replace the lead service lines, they would slow it down a lot, and that means just more kids, another generation of children who'd be exposed to this neurotoxin and dealing with developmental delays, you know, learning disabilities, things like that that they just don't need to be, you know, burdened with.
Robert Menendez
Yeah, and the communities I represent know the consequences of aging lead pipes firsthand. Newark overcame a serious lead contamination crisis that threatened the health and well-being of more than 200,000 residents. I'm proud that the city responded with an ambitious program and replaced all of its lead service lines. But Republicans' proposal would deny other communities the resources they need to act before a crisis occurs and to protect families from serious harm. Ms. Wu, what are the public health consequences when lead pipe replacement is delayed because communities lack the funding to finish the job?
Mae Wu
I think the problem is that we're just going to leave a generation of children behind. And they, you know, they will have to deal with the burdens of, you know, having delays in schools and, you know, other issues. So we really need to work quickly on this.
Robert Menendez
I agree, and Democrats are aligned there because we have to protect our families from permanent harm to brain development and other lifelong health effects caused by drinking lead-contaminated water. Like, we should be able to assure that every American and every American child is drinking clean water. It's, by the way, 2024. The IIJA's $15 billion in supplemental funding dedicated to lead service line replacement helped prevent those consequences and keep children from getting sick. We have a proven federal model and we should build on it now.
Ms. Wu, again, using the example provided by the IIJA, do you support authorizing a dedicated lead service line replacement funding stream as a supplement to the Drinking Water State Revolving Fund?
Absolutely.
Robert Menendez
I want to turn now to another topic that is so important to New Jersey families: data centers. Republicans have proposed a bill that would require the EPA to report to Congress on the sources of water that data centers use. But as this infrastructure expands, communities need to understand not just where data centers get their water, but how much they use, how that demand affects local water supplies, and what it means for their water bills. That is why my Data Center Transparency Act would require the EPA to publicly report on those key metrics. Ms. Wu, would you agree that collecting a fuller range of metrics would help communities make more informed decisions about the environmental impacts of data center infrastructure?
Yes, absolutely.
Robert Menendez
And at the core of my bill, at its core, my bill is about making sure that data center growth does not come at the expense of our communities' well-being. Yet the discussion draft before us solely directs the EPA to submit a single report to Congress on data centers' water sources without requiring any updates or public disclosure. Ms. Wu, in your view, should the information the EPA collects on data center water use also be made publicly available so communities can understand the impacts for themselves?
Robert Menendez
I agree, and that's why it's critical that communities have public, up-to-date access to this information. That is because affordable access to clean, safe water is a fundamental right and a basic service that we should help deliver for every American family across the country. I'm disappointed but not surprised that Republicans have used this hearing to advance proposals that fall far short of providing the investments and safeguards we need to protect public health and ensure reliable, affordable drinking water.
I urge my colleagues on the other side of the aisle to change course. I look forward to continuing to work with my Democratic colleagues to meet this moment and deliver for our communities and water systems. I yield back.
Bill Johnson
Thank you very much, gentleman yields back. The chair now recognizes the gentleman from Colorado's eighth district for five minutes for questions.
Yadira Caraveo
Thank you so much, Chairman and to the ranking member for this hearing. And thank you so much to our witnesses for taking the time to come and talk about water. This is an incredibly important topic to me, being from Colorado, where we are in a historic drought right now and we're traditionally just a very dry state anyway. Some of my district, the North Denver area and the Northern Colorado, some of the fastest growing areas in the country right now. And so water projects, being able to have the funding for water projects is critically important.
And of course, it's also critically important that once we get the funding, we can actually go and execute that money to create, as Ms. Wu said, you know, we need more infrastructure in this space. One of the challenges that we're facing in Colorado, Denver Water, which serves about 25% of the population of the state of Colorado, is trying to expand a reservoir and it's been under litigation for two decades. I'm just going to read a quick excerpt here from a news article. Six environmental groups challenge Denver Water's plan to store more water for the 1.5 million people it serves. And again, this is the Gross Dam.
So understand the importance for getting more funds. I've proud to have gotten tens of millions of dollars in water funding for my district. But I think we also know we need to have a pathway forward to execute it so that these projects don't get bogged down in litigation for, in this case, two decades. And when we're talking about water and infrastructure, one of the other big concerns that my constituents have specifically is around water and data centers. And I typically hear this along two different avenues.
They talk about data centers in terms of power usage. We have my Ratepayer Protection Act, which addresses the power side of the equation, and then also the water usage side. And so we know two things can be true at the same time. First, we have to have the digital infrastructure to beat Communist China, make sure that our sensitive data is not being stored in China in Chinese data centers that were created with a much larger carbon footprint and larger negative environmental impacts. So we have to have that digital infrastructure here.
But we also have to make sure that our communities know that these things are being done responsibly, especially in dry places like Colorado, with a responsible eye toward water usage. And so, Mr. Bradley, first series of questions to you. In your view, what responsibilities do data center developers and hyperscalers have to the communities where they're developing these projects?
Neil Bradley
Congressman, I think first they have to be transparent and they have to provide wonderful data about what their expected uses are, the impact. They have to work through that with the local community and the local utility provider. Second, as we've seen with over 200 companies making commitments on the electric utility side, they have to commit that they're paying their incremental costs to the system and contributing back to that. I think third, they need to have a commitment to innovation. One of the things that we know is that technology isn't just moving fast in AI and data centers, it's moving quickly in the physical world about how you power a data center, how much it uses, how much water it uses.
And continued innovation will actually help us reduce stress on the system and demands in the system going forward. So I think accomplishing those three things is the type of responsible development that we're seeing occurring around the country.
Yadira Caraveo
Let's talk specifically about water. Can you share some more information about how responsible data centers are being built to reduce their water usage by either recycling the resources they need, using closed-loop systems? And if you happen to know, I'm in the heart of oil and gas country, can you comment specifically on using produced water to cool data centers, if you happen to know that specifically?
Neil Bradley
Congressman, you referenced several of the ways that they're doing that, right?
A closed loop system, which is the traditional water that we understand but in a closed loop, so that you're not losing excess water through the system. Second, you combine that with potentially air cooled, depending on the climate and the environment, you can supplement using kind of two systems. Third, we have increasingly using gray water, if you will, so not water out of the drinking system, but water that they can pull into the system that we can use and that we can put back in to the local water system after cleanup and refinement. And then finally, to your point about oil and gas, there are alternatives to water for liquid cooling. And that's some of the newest innovations that we're seeing, and it's ability to actually submerge these components into a liquid that heat can transfer, but electricity will not transfer, which actually gives you an alternative to drawing down from the local water supply.
Yadira Caraveo
So in my final 15 seconds here, relative to something like a golf course, how much water does a responsible data center actually use?
Neil Bradley
We're increasingly reaching the point, for example, Microsoft just announced a data center that will use four Olympic-sized pools over the course of a year, substantially less than your typical 18-hole golf course. And so it depends on the size, it depends on the cooling structure, but the trend that we're going is to less water utilization.
Thank you, and I yield back.
Redner 34
Gentleman yields, chair now recognizes gentlelady from California, Ms. Barragán, for five minutes for her questions.
Nanette Barragán
Thank you so much, Mr. Chairman. Ms. Wu, I'd like to start with you. Do you know how much Republicans are proposing to cut in the bill, the Safe Water Drinking Infrastructure bill?
Redner 32
It looks like they're cutting like 1 and 1.25 billion dollars. It's really over a billion dollars.
Nanette Barragán
Does that sound like an investment in infrastructure for clean water or the opposite direction?
Mae Wu
It is not an investment in keeping up with the need. It is taking a step backward.
Nanette Barragán
Yes, so it's really perplexing to sit here and listen to my Republican colleagues talk about clean water infrastructure and clean water and clean water, yet they're cutting money that's going to go into the investment of having clean water. You know, there are communities across the country that are facing growing challenges to keep drinking water safe and affordable. And aging infrastructure, PFAS and other contaminants and rising costs are putting more pressure on local water systems. I know, I've heard about it firsthand. And here we have a Republican bill that proposes much lower funding level for the Drinking Water State Revolving Fund, which helps communities pay for critical drinking water projects.
Ms. Wu, you've previously testified before this committee on PFAS. In South Gate, which is in my district in California, four wells affected by PFAS supply more than half of the city's total water demand. What would less Drinking Water State Revolving Fund support mean for communities like South Gate, California, that are trying to keep harmful contaminants like PFAS out of their drinking water?
Mae Wu
I think it means they're going to have a much harder time protecting their residents from chemicals like PFAS and that people will, you know, have to deal with the consequences of being exposed to those chemicals.
Redner 35
Thank you. And when the federal support falls short, that means that local water systems will are left with the choice between raising rates on families and delaying treatment of contamination, would that be accurate?
Yes, that would be right.
Nanette Barragán
So at a time when Americans are facing a high cost of living because of Republican policies, this is just going to further increase the chances that people's water bills are going to go up more because local local water agencies will have to figure out either how to fund it or raise rates.
Mae Wu
That's right. If the federal government can't provide more of the funding, then yes, the local governments who will have to pay for those costs will pass them on to their customers and you'll see higher monthly bills.
Nanette Barragán
Thank you. Mr. Bradley, I was very pleased to hear your opening testimony talk about it doesn't matter whether it's a golf course or a data center or other things that these costs should not be passed on to consumers. You've spoken quite a bit already about these new systems like closed-loop systems to reuse the same water repeatedly. Is there anything else you want to add about those? Because I have to tell you, I hear from people all the time just how bad data centers are and how the water is going to be either contaminated or used at high levels.
Is there anything else you want to add about these new and improved systems that maybe we need to tell more people about?
Neil Bradley
Well, Congresswoman, as I said in my opening statement, I think what we've learned about data centers from 10 years ago or 20 years ago isn't necessarily applicable to the data centers that were built two years ago or that are being built today. And so I think people have legitimate questions and concerns, and I think there are good answers to those. And those answers have evolved as technology has evolved, and that's a good thing and we should expect to continue to see that. So I think the most important thing, as I alluded to earlier, is that we have transparent conversations in the local communities where these developments are being proposed, and we appropriately assess the capacity of the local utility to provide that and what the developer is going to return to that local system and to that community. I think if we have that honest, transparent conversation, people are going to find and make decisions that are best for their communities, which will often mean approving these types of developments.
Nanette Barragán
Mr. Bradley, do you think Congress should be the one that does more to push the data centers to reduce their water usage?
Neil Bradley
I think this committee and Congress is doing an important role of laying out objectives and principles you want to follow. As I mentioned earlier, the practical implementation of this will have to occur at a local level because every data center's different, every local utility is different, so I think we have to be mindful of that.
Nanette Barragán
Thank you. Ms. Wood, do you have an opinion whether Congress should be the one to push large data centers to reduce their water usage?
Mae Wu
I think it's important that data centers do reduce their water usage and Congress can be a great voice for that need.
Secretary Moore?
Redner 37
Thank you. Congress obviously plays an important role in all of the conversations about water infrastructure and water needs at a national level.
Great. Thank you. I yield back.
Redner 36
Gentlelady yields. Chair now recognizes the gentleman from Virginia, Mr. Griffith, for five minutes for his questions.
H. Griffith
One of the draft bills that we're talking about today has to do with water rates for data centers. Thank you, Mr. Chairman. I know, Mr. Bradley, you've already discussed some of this, but I'm going to ask again, but mainly for those watching back home. Could you speak a little bit on how all industrial water users normally enter into water use agreements?
Neil Bradley
Certainly, Congressman. When you have a large-scale water user who is coming in and proposing to access a system, you will likely have a local agreement with that system that governs the expected uses, costs, implementation of that. And that type of agreement can set the framework for both the financial commitment of the large-scale water user, in this case a data center, but also the infrastructure that the local utility will need to deploy to be able to meet that increased demand. And so you often have these type of local agreements just so that you can properly allocate costs and properly allocate the investments in infrastructure that you need.
Redner 42
And that's why it's so important that the final decision, while we can influence the policies and so forth, the final decision needs to be a local decision, depends on how much water they have available and whether or not they can reach an agreement that they think works. Is that right?
Neil Bradley
That's exactly right. And you know, you could have the same data center in two different places and you would reach two different conclusions because circumstances are different.
H. Griffith
And do you think we should include provisions in our draft of Water Cost Accountability Act on water recycling for large users?
Neil Bradley
I do think water recycling holds a lot of promise. There are other proposals pending in Congress, for example, for investment incentives for water reuse. And so, in addition to covering the rate questions, figuring out how we can reduce overall demand from large-scale users would be an appropriate consideration for the committee.
Redner 41
So, and just again so folks back home can understand what we're talking about, I noticed in a recent article in the Cardinal News by Dwayne Yancey that he talks about a plant not coming in my district but coming nearby. And Google is touting that they're currently doing roughly 78% of their freshwater consumption is being replenished. Now, part of that is creating wetlands. So it's not just your straight recycling, it could be creating a new wetland opportunity which could increase the value of the aquifer. Is that right?
Neil Bradley
Absolutely. Again, each location is a little different, and so a wetland might make sense in some places, it might not make sense in others.
Redner 40
And it's interesting, their goal apparently is 120% so that they can really help our water supply long-term.
Neil Bradley
They would be net negative with respect to their contribution, which inures to everyone's benefit in the local community.
Redner 41
Yeah, but it is a local issue. Now, if we have one of these agreements and under the draft proposal infrastructure costs for data centers are to be recovered from these larger customers, but how do you see this requirement for recovering this infrastructure cost impacting water system bond underwriting?
Neil Bradley
Well, certainly if you have a water system who has an agreement with a guaranteed revenue source, bond issuers are going to look favorably upon the fact that you have this commitment that is bound for that revenue. That could actually improve the potential for financing.
Redner 41
All right, so can you address concerns about what happens if the data center fails and ends up going under? Or any large water consumer, but particularly we're talking about data centers.
Neil Bradley
Yeah, I'm not sure we have seen an example of a data center going over given demand, but yes, I think there are a couple of options here. One is, does the underlying agreement address that issue? It could potentially, and that could be something a local community or utility would insist upon. You might have rights that are transferred as someone else picks up that asset. If you have invested the resources as a local community to provide access to that water, that's becoming a valuable commodity these days.
I suspect there are other people who would love to pick up that opportunity and replace whatever the failed data center or other large-scale user left behind.
Redner 41
Thank you. Secretary Moore, I might have to give you some written questions later, but one of the things that I always have to be concerned about is I represent a number of rural water utilities. Can you speak on how Congress can improve technical assistance training for rural water system employees as a part of this draft Safe Drinking Water Act?
Julie Moore
Sure. One of the ways is to ensure that the state programs are fully funded by moving to take community-funded projects off after state set-asides come. Those are the dollars that flow directly to the team at my agency who are providing direct technical assistance to local water utilities. In addition, organizations like RCAP and the Rural Water Association are incredible in terms of the technical assistance they are able to provide to our rural communities.
Redner 44
Gentleman yields. Chair now recognizes the gentleman from Ohio, Mr. Latta, for five minutes for his questions.
Robert Latta
Thank you, Mr. Chair, and thank you all for being here. I want to start on the data centers question. The narrative sometimes gets to be about, you know, do we do data centers or do we not do data centers, do we want to win the AI race with China or not?
To me, the question here is who pays and are our towns protected? The issue around water is pretty significant in the sense that, you know, they, these data centers use a ton of water now. And I think it's something like 40 or 50 million gallons a day. Based on the projections of the construction of new data centers, that's going to be something like 200 million, so four times as much, and that's just in the next year or two. Almost all that water comes from public water systems.
And for me, it's, you know, what are the disclosure requirements? I mean, at the moment, we don't really know. I mean, there are examples of good actors, examples of bad actors, examples of folks who are using great technology and, and there are examples of folks who have not done the right thing. But we don't currently have federal disclosure requirements in terms of how much water a data center is using at their peak or just in general or both, where they're getting the water, how much they're taking from the groundwater, what their wastewater discharge workload looks like, what kind of cooling technology, none of that's currently required. And so communities lack information.
And then there's no requirement that they pay for all of their water usages, usage, sorry. Um, or there's no requirement that they pay for the infrastructure. Now, some may be doing that and those agreements get worked out on the local level, but there's no requirement. So again, local communities don't have much leverage here. So they lack information, they lack leverage.
I'm curious, and I'm going to start with you, Ms. Wu, what do you think Congress's role should be as it relates to the water piece?
Mae Wu
I mean, all the things that you just talked about, right? I think transparency is very important, but not just transparency, like we really need to know specific pieces of data about this water system and the community needs to know. It can't be a check the box exercise where they're like, oh, we had, you know, we had a meeting and we talked about it. And so things like, you know, peak demand, peak, especially during the hottest days, that's what the community needs to know. Like, you know, and when, if they have a drought, like what is going to happen with their water?
It's a finite resource that we're talking about.
Robert Latta
By the way, this would be pre-construction disclosure too. I mean, because that would help people understand what do we need to ask for as communities try to work this out. Secretary Moore, I want to ask you, Mr. Bradley too, your thoughts on the role Congress should play here.
Julie Moore
Sure. One point I would like to raise, and this is coming from the perspective of a state where only about half of our residents are on public water systems, is if a data center is not connected to a public water system, it's, I'm not sure that there are currently frameworks in place to require the kinds of reporting, whether it's a groundwater withdrawal or a surface water withdrawal. Vermont has put in place some regulations to deal with some other industrial uses within the state, but I don't think those, that those are widespread. And so just would, would put that out there as a placeholder. The other thing I would just...
Robert Latta
Wait, I just want to make sure I'm understanding what you're saying. Right now there just there are no there are no requirements to to tell folks how much water they're going to use. Are you suggesting that they do or are you just saying they don't?
Julie Moore
I am saying that if you're not connected to a public water supply, if you were to drill your own well or construct your own surface water intake, those requirements are not consistent nationwide for reporting.
Neil Bradley
Got it, yeah. Mr. Bradley, Congress here, I mean, the role... In general, transparency's a very good thing and I think this hearing and the work that you all are doing highlights these issues. I think Congress has to be careful about being prescriptive about what you want to see in each particular development because the the data center or the other large-scale user can look very different, the local community and the water system can look different, and what would make sense in one place may not make sense in another, and you really have to empower and these local communities are empowered, they're the ones who control the permits, to really decide if it's works for their community. Thank you, my time's expired, I yield back.
Gentleman yields, chair now recognizes gentleman from Pennsylvania, Dr. Joyce, for five minutes for his questions.
John Joyce
Thank you, Chairman Palmer and Ranking Member Tonko, for holding this important hearing, and to our panel for being here this morning to testify. Earlier this year, I chaired an Oversight and Investigation Subcommittee investigation regarding the cause of the Potomac Interceptor collapse here in DC and the resulting impact. Through that investigation, which Mr. Palmer had originated when he was the chairman of the Oversight and Investigation Subcommittee, it became clear how serious a failure in this critical infrastructure can be and how important it is to maintain support for both regular maintenance and future investment. All over our country, aging sewer and drinking water systems need repairs and they need upgrades. Some of these projects have been put off for years due to lack of local resources, risking future public health and clean water disasters all across America.
This risk is especially urgent in rural communities with smaller water systems like many of the municipalities that I represent. In meetings, I have heard regularly from small water and sewer authorities who are struggling to maintain infrastructure nearing its end of life as they wait for funding and resources needed for replacements and upgrades. A disruption in either service can put a strain on both systems and place serious burdens on the community and on the operators who maintain the infrastructure. In the draft legislation that we are considering today, I am glad to see a commitment to maintaining and modernizing the Drinking Water State Revolving Fund. This is a necessary federal funding source that communities in my district rely on.
In preparation for this hearing, I heard from the manager of the Altoona Water Authority in my district on how these funds have allowed them to complete necessary projects, from water line replacements to treatment facilities improvements, all the while maintaining low customer rates and providing the cleanest water to the highest standards. Ms. Moore, in your testimony you discussed the increasing financial strain faced by communities. How can the funding from SRFs be leveraged to provide the most benefit to the most in-need communities?
Julie Moore
Sure, so the small and disadvantaged community set-asides are a really important tool, but we know that our communities are facing increasing challenges from emerging contaminants, including PFAS, that they simply hadn't anticipated and that the treatment costs associated with those technology or with the technologies needed to address PFAS contamination are expensive and can be labor-intensive and complicated to operate.
So it is a combination of direct financial assistance through the State Revolving Fund program, um, through robust, robust reauthorization, coupled with strong technical assistance from state agencies and our partners to ensure that those smaller communities have the resources they need.
John Joyce
Ms. Moore, can you elaborate on the role that set-asides play in helping smaller water systems both stretch their very thin resources as well as assisting the state in effectively directing those resources?
Julie Moore
Absolutely. Those set-asides are critical to maintaining the staffing I have within my Drinking Water and Groundwater Protection Division at the Agency of Natural Resources. About 40% of the staff in that team are funded through those drinking water set-asides, and those are folks that are on the ground working hand-in-hand with our municipalities to ensure that they're able to meet modern standards and provide their residents with safe, reliable water.
John Joyce
Thank you. Mr. Bradley, how can smaller communities leverage the funds available through the SRF to attract additional capital investments and the necessary economic growth?
Neil Bradley
Congressman, I think part of it comes down to technical assistance and the ability to figure out how to access these. I think the government has a role to play, but so does the private sector. Um, at the US Chamber, we've partnered with the Penn Water Center and the company Veolia to actually provide private resources on some of that technical assistance. I think that can work. I think we could consider, um, particularly since we have so many small providers, um, how we can achieve scale amongst them.
John Joyce
So how does attracting the economic, this additional economic growth, how can that bolster the small systems in communities that I represent to for further maintenance and upgrades for their infrastructure?
Neil Bradley
Well, I think first is the ability to potentially attract that additional funding and leverage private. And next steps, I think the next steps for them are you have to figure out the viability of the system and whether or not there are efficiencies of scale, sometimes by combining systems, sometimes by sharing larger resources. So this is a problem not unique to water utilities.
John Joyce
The drafts that we are considering today are a positive step forward supporting drinking water infrastructure, especially in smaller and rural communities. And I look forward to working with my colleagues on this committee to ensure that every American has reliable, safe, and clean access to water. Thank you, Mr. Chairman, and I yield back.
Gary Palmer
Gentleman yields. Chair now recognizes gentleman from Florida, Mr. Soto, for five minutes for his questions.
Darren Soto
Thank you so much, Mr. Chairman. The Bipartisan Infrastructure Law was a game changer for fast-growing Florida. When we saw it passed, it helped with expanding I-4, a 3.4 billion dollar project. We've seen over a half a billion dollars we were able to secure for Orlando International Airport, um, for our tourism industry, for our workers, for Central Floridians to be able to fly across the world. SunRail, Kissimmee Airport, a lot of people know these contributions that we worked on.
But another major part of this was water. It's something that a lot of folks may not see as much, but they expect clean water, they expect clean lakes. And so when we're talking about the State Revolving Fund or the Water Resource Development Act or WIFIA loans, um, our region, um, was able to through our help and others get over a billion dollars in projects over the last couple years. We saw Toho reservoir being built, a Polk County water initiative, Orange County water supply projects, a Taylor Creek reservoir, and of course the restorations that are ongoing at East, North, and Big Lake Toho. Um, and so Secretary Moore, how important is it for strong federal funding for state and local projects?
Vermont, a smaller state, I'm sure you don't, you're not swimming in money there. I, give a, paint a picture for folks at home how much of this is federal dollars flowing down to help state and local water projects.
Julie Moore
Sure. The federal funding made available through the drinking water SRF is incredibly important to our ability to support communities in making necessary investments in their systems. We have some very old infrastructure in Vermont. A lot of it is coming due in terms of being at the end of its useful life. We have, you know, stable but but not large user bases in most of our drinking water systems.
So the ability to provide access to low-cost capital is critical to systems' ability to make those investments.
Darren Soto
Absolutely. And when we got our allocation in Florida, a lot of people were surprised. It was one of the biggest ones because although a lot of areas are new, we have some really old areas like St. Augustine, 1500s, right? And so and then we had a lot of rural communities that were falling behind. How important is it for some of these small cities and towns and counties that are fiscally constrained rural counties?
Julie Moore
It is. In terms of user affordability, it's critical. If communities had to go to the private market to access the kind of capital that they are able to through the state revolving fund, it would see a dramatic increase in user rates and ability to pay. And I think would actually result in projects going untended.
Darren Soto
Absolutely. So members, we got to dig deep on this. This is important for all of our states, especially fast-growing states as well as states that have fiscally constrained counties and cities. And we also hear a lot about the data center issue. It's absolutely essential that we empower local communities decide whether or not they want a data center in their area.
This has been a something that has been debated throughout Florida. We just passed out of this committee a Ratepayer Protection Act. But we know data centers use a lot of water. And so, Ms. Wu, you worked with the EPA. How important is it for bills like the Water Cost Accountability Act to make sure we're prohibiting water systems from recovering costs from customers?
Mae Wu
Yeah, it's really important. And these are the ways to protect your, you know, your customers, the ratepayers and residents in these small communities especially, from having to shoulder the the cost of these, you know, these big projects.
Darren Soto
If we didn't have these laws that we're pushing in place, what would be a ratepayer's recourse if they got their water jacked up because of a data center or other other use?
Mae Wu
I'm not sure that they would have a lot, bringing it to their, you know, public utility board and just trying to to raise it there, but there's not a lot.
Darren Soto
Mr. Bradley, what kind of water resources do you think we need as we keep pace with technology from a water perspective?
I apologize, Congressman, what kind of water resources or?
Yeah, water infrastructure.
Neil Bradley
Well, we need to continue, as you all have discussed here today, investments in the underlying infrastructure, if nothing else, just to replace what is aging. And so the good news is is that we can become more efficient. We don't have to replace with the same type of capacity and technology that we built with 40 or 50 years ago, but it doesn't change the need that we need to make investments both in the drinking water, wastewater, and other utility sides.
Darren Soto
And there are many things the private sector does well, but water is something that you rely on government to help make sure is there for a lot of businesses, isn't that right?
Neil Bradley
We certainly rely on government, but the private sector is a water provider or the implementer in a lot of communities. And so an important partnership.
Gary Palmer
The gentleman yields. The chair now recognizes the gentleman from Texas, Mr. Pfluger, for five minutes for his questions.
August Pfluger
Thank you, Mr. Chairman. Appreciate the witnesses being here. I think it's important that we deal in facts, and your testimony is very important. I think multiple things can be true at once. And the acknowledgment that water is an issue, I represent West Texas, obviously that is true there.
The acknowledgment that data centers are important, or really any other industry that uses water, any other commerce that we have. And the transparency and the things that we're talking about in this hearing are incredibly important. Mr. Bradley, in your testimony, you discussed the importance of assessing local water availability, alternative sources, drought risk, and expected water needs of individual projects. Is it fair to say that the water impact of a data center is highly project and location specific?
Neil Bradley
Absolutely. It would vary very much from whether you're in West Texas or you're in Loudoun County in Virginia or you're up in the Great Lakes area. Very different environments. And by the way, the data centers can often be very different as well.
August Pfluger
Just broad philosophy on a regulatory approach. I mean, what do businesses across the country, knowing what you just answered, that they vary significantly, I mean, what do they prefer on the regulatory approach? Strict regulatory approach, light touch? I mean, what allows commerce to succeed most?
Neil Bradley
Very much a light touch and local. A national solution here, we can set some national principles, that's important. But because the circumstances are so fact-dependent in local communities, you could write a rule that might work in Northern Virginia but wouldn't work at all in West Texas or vice versa. The other problem with kind of static regulatory is it doesn't take into account innovation and technological change. If Congress had written rules around data center water and electricity use five years ago, maybe even two years ago, they wouldn't match with where technology is today, and it certainly won't match with where technology is going to be two years from now.
Redner 53
So it's fair to say that they're adapting to a resource-constrained environment. Is the transparency also, have you seen a shift toward transparency in local communities getting the information they need?
Neil Bradley
We have. And listen, I think a lot of data center developers in particular, but this is true for a lot of developers, happens to be particularly true at this moment for data center developers, maybe weren't as transparent as they should have been in some of the initial construction. I think they've learned an important lesson. I think the good news is that they should be proud to tell their story because of the innovations that are occurring and because of the public services, the tax revenue base, and the economic opportunities they are creating. I think they can let people judge for themselves, and I think a lot of communities will come down on the side of, this is pretty good for us.
Redner 54
Again, very location-specific, project-specific. Secretary Moore, you represent state environmental agencies across the country. And from your perspective, how important is it that the water impact of a major new user be evaluated based on the specific water resources, the infrastructure capacity, and other factors?
Redner 52
Yeah, obviously that varies widely from state to state and jurisdiction to jurisdiction and just highlights the importance of transparency and information sharing around water usage.
Thank you. And Mr. Chairman, thank you. I yield back.
Redner 60
Gentleman yields. The chair now recognizes the gentleman from New Jersey, Mr. Menendez, for five minutes for his questions. He didn't come back. Sorry, Jake. The chair now recognizes the gentleman from Massachusetts, Mr. Auchincloss, for five minutes.
Jake Auchincloss
That actually happens pretty frequently. Thank you, Chair. Appreciate the witnesses. One of my priorities in office over the last six years has been clean water infrastructure for Massachusetts. We are a state with a long industrial legacy, dense land use patterns, and so the soil and the water has a high rate of carcinogens and other toxins.
And so getting that cleaned up has been a priority, been able to direct tens of millions of dollars back to the Massachusetts Fourth for water treatment facilities. But I have heard in the last few years real concerns about supply chain concentration and regulations that are raising the cost of these water treatment facilities pretty dramatically.
Ms. Wu, I want to direct my question to you and focus on the impact of Build America, Buy America provisions. And I was proud to vote for and pass the Infrastructure Investment and Jobs Act, but part of our job as legislators is to examine the impact of the policy we passed and see what needs to be amended based on reality. And reality has changed a lot in five years. And as I said, I've been hearing from municipalities about increased costs based on some of these requirements and based on supply chain concentration. Should there be actions that Congress can consider to improve or better tailor these requirements?
Mae Wu
Yeah, I mean, I think, you know, if it was Congress's policy that we do want to, you know, have more domestic products, support these infrastructures, then there's some things that could be done to preserve the goals of Buy America, Build America. And so some of the implementation things that could be done is more targeted and evidence-based medium-term product waivers, and also more coordinated industrial strategy with specific industries to help reshore and build domestic capacity here. And that could help keep the policy in place but deal with some of the cost challenges.
Redner 49
Do you have an example or do you have in mind elements of that value chain that you think need a more coordinated industrial strategy to prevent bottlenecks?
Mae Wu
I don't have specific ones in mind, but I know that we can, you know, get some thoughts to you.
Jake Auchincloss
Do either of these other witnesses have thoughts about are there bottlenecks within the water treatment facility value chain that you're particularly concerned about that are driving up costs?
Redner 50
Nothing comes immediately to mind, but I am happy to go back to my team and ask if they have specific examples they would offer.
Jake Auchincloss
Got it. I will ask one other question and it's open-ended here, which is we're trying to remediate and address PFAS contamination, and proud of the work that the Biden administration did on this and that Congress did on this in our water supplies. The challenge is addressing it in our municipal water supplies is the point at which it is the most diffuse and the most expensive to try to capture and interrupt that bioaccumulation cycle of PFAS, right? It's we're talking about parts per trillion. Meanwhile, at the point of production, when PFAS is being added to the bottom of skis or to cookware or to rain jackets, it's like parts per million and it's a lot easier to try to remediate and address.
Do you think that it would help water treatment facilities reduce cost, just improve the whole process of water potability if we address PFAS contamination at the point of production for non-essential uses?
Julie Moore
To me, the answer is an and both. There are many, many materials that have been produced over decades that are out in circulation at this point, and so we know that those are going to continue to contribute to downstream and passive receptors. But at the same time, reducing the amount of new PFASs introduced into the environment is important. Vermont has passed several pieces of legislation with different product bans and stewardship requirements trying to get at that source control while also working with municipalities to implement treatment on the back end.
Jake Auchincloss
Yeah, no, clearly we can't unring the bell. I mean, you look at firefighter foam and you look at, I mean, and the leaching out of landfills. We got to remediate it at the point of consumption as well.
But it seems like it would make sense to, as we are dealing with the cleanup, to also try to prevent our grandkids from having to deal with this by getting it at the point of production as well. Ms. Wood, did you have thoughts on that?
Mae Wu
Yeah, I do. And I think that there are some things that could be done. We were looking at things like effluent limitation guidelines so that the production companies, like the ones making the PFAS, actually have to put some kind of treatment on their outfalls so it doesn't even go into the wastewater in the first place. So then our treatment plants and our utilities don't have to pay for cleaning that up.
Jake Auchincloss
Absolutely. And we've done this with other toxins. This is not a new concept, right? We just got to apply this to PFAS. We've done this, for example, with ozone-depleting chemicals in the 1980s with the Montreal Protocol.
This is a template that Congress has. We just need to act on it for PFAS now.
Absolutely.
Redner 57
Gentleman yields. Chair now recognizes gentleman from New York, Mr. Langworthy, for five minutes for his questions.
Nicholas Langworthy
Thank you very much, Mr. Chairman. I represent Western New York and the Southern Tier, including many, many small rural communities where local governments and water systems are responsible for maintaining critical infrastructure across very large geographic areas with very limited resources. For a small town, replacing a water main, upgrading a treatment facility, or complying with a new requirement is a very significant expense. And they don't necessarily have the large staffs or dedicated grant writers or engineers. And when costs increase, there's fewer and fewer ratepayers to absorb that cost.
And that's why programs like the Drinking Water State Revolving Fund and federal technical assistance can be particularly important for the communities that I represent. Secretary Moore, what are the biggest infrastructure and financial challenges that you're hearing from small and rural water systems, and do these bills go far enough to ensure that those systems can actually access the assistance available to them?
Julie Moore
That's a great question. I think it's severalfold. The shrinking user base, as you alluded to, is probably at the top of the list. So having fewer connections over which to spread those costs of the necessary investments is an incredible challenge. I think being able to have the administrative capacity to support the administration of many of these projects is also a real challenge in our smallest communities.
Once the construction's underway, you have an engineer and a contractor on site that are supporting you, but getting that project from conception to construction takes a lot of work at the local level. And often that work in our smaller communities is being done by volunteers. And that is why those set-asides in the Drinking Water SRF program are so important. They fund technical capacity through the state to be able to provide that support to communities in moving those projects from conception to construction.
Redner 59
And I think accessibility is an important part of this conversation. And it doesn't do much good to create a federal program intended to help small communities if navigating the program itself requires resources that the communities don't have. The legislation before us recognizes the challenges facing our drinking systems are changing. And today, a community isn't only responsible for maintaining the pipes and the pumps and the treatment facilities, but water systems increasingly have to protect their technology that controls the infrastructure from cyberattacks. And a large utility, they may have a dedicated cybersecurity team, but a small rural system has a handful of employees responsible for every element of the execution of the mission.
Secretary Moore, how significant is that resource gap when it comes to cybersecurity, and how can technical assistance and workforce provisions in these bills help smaller systems to protect themselves?
Julie Moore
Yeah, that gap is real and daunting for many of our smallest systems. As I noted before, one of the strategies we sometimes joke about that those small systems use is simply not being connected to the internet, which presents its own sets of challenges. But really, the technical assistance along with infrastructure hardening need to go hand in hand in the services being provided to small communities to help them face those growing threats.
Nicholas Langworthy
And we also need to make sure our federal dollars are being used effectively. And the legislation, it strengthens oversight of state revolving fund projects while continuing investments in infrastructure, lead reduction, resilience, and assistance to disadvantaged communities. For taxpayers and for the communities relying on these programs, we should know that those dollars are actually producing better and more reliable infrastructure. Mr. Bradley, as we reauthorize these programs for another five years, what can Congress do to ensure that federal drinking water dollars are spent efficiently and result in the greatest possible infrastructure benefit for our communities?
Neil Bradley
Well, Congressman, I think you're doing some of that in this legislation, particularly as you think about how to address cybersecurity challenges. I think you can also think about some of the other technological innovations and access that might be harder for a smaller or rural community. We also ought to begin thinking creatively about how smaller utility providers might be able to share some of the expenses for some of these things that aren't necessarily unique to an individual community, a cyber threat or innovations in some of the technology. You know, this is not a problem unique to water systems. When you have small-scale providers and declining demographics, you have to start getting really creative about how you continue to provide services to that declining population base.
Redner 59
Small communities, they don't need lower standards. They need practical tools and resources that allow them to meet high standards without placing an unsustainable burden on their residents. And I look forward to that goal and I yield back, Mr. Chairman. Thank you all for being here.
Redner 61
The gentleman yields. Chair now recognizes the gentleman from Texas, the vice chairman of the subcommittee, Mr. Crenshaw, for five minutes for his questions.
Dan Crenshaw
Thank you, Mr. Chairman. Thank you all for being here. It's an important topic today about water infrastructure, ratepaying, all of these things, affordability. There's been some good conversation about what those levels of funding should be and how ratepayers need to be protected. And I think there's a good bill today that seeks to protect ratepayers and water quality and supply, especially in the modern age where there's an increasing number of data centers being built.
And now there's of course trade-offs that are worth raising. There's concerns about water supply and grid strain and electricity prices and problems. But you know, these are solvable problems. And today's bills are aimed at solving these problems. I've introduced also the DATA Act.
The DATA Act would allow data centers to build their own energy supplies on site. It would federalize what many states like Texas have done. This is all common sense stuff. I really hope the committee takes up that piece of legislation. And I'll say this about this committee, and I mean it, this is one of the committees I truly enjoy serving on because we work on things that matter to people's lives.
Nobody's clipping this hearing for some viral clickbait moment. Then again, what I'm about to say might get clipped. No, we're talking about stuff that's boring but really important. It's about, you know, water safety and at prices that people can afford. That's actually the job we were sent here to do.
And it really drives me crazy, honestly, how much of the work that comes out of this committee, bipartisan, substantive, negotiated in good faith, and just dies between here and the House floor because outside of this room there's plenty of members who'd rather torch a deal, get social media clips, as opposed to doing something that actually passes into law. So this committee does the work and a handful of unserious members kill the work.
The data center debate is pretty heated right now. And just real quick, yes or no, does everyone here agree that data centers, they're not only inevitable, but they're a good thing as long as the negative consequences can be mitigated? Yeah? Generally agree? I would hope so.
Do you think the bills we're considering today are an effort to mitigate some of those consequences, especially the Affordability Accountability Act? Yes. That's good. Right, you know, the truth is that the best thing we could do for China today is to regulate ourselves out of data center construction. Because that's exactly what they want.
And, by the way, they're pushing it. They're pushing anti-data center propaganda over social media. This past week, X investigated over 200,000 accounts that have been boosting anti-data center posts. They were created by Chinese accounts. They pose as American accounts.
As President Trump recently said, China could not be happier with this anti-data center movement. And I agree. Because if you're against data centers because social media got you all riled up, you are an unwitting propaganda tool for the CCP. I'm sorry, but I'm not sorry. That's just the truth.
Because people fear things they don't understand. I get that. I also don't think it's an excuse. And I have a feeling that most of the people screaming online about data centers are probably the same people that think burritos cost $20. The solution is not screaming more at the wall.
It's a solution to do your research and to seek to understand things that you don't understand. And that's up to you then to vote the representatives in that don't just mirror your anger back to you in order to get your vote, but actually work to find solutions like the people on this committee. And like I said, we do have plenty of solutions. This committee is the one of the few that bothers to create those solutions. I'm proud to be part of this committee, proud to have served, and thank you to the chairman and thank you for the leadership of Energy and Commerce who recently asked the FBI to investigate some of those anti-data center campaigns that I had just noted.
So proud to be part of this and I yield back.
Gary Palmer
Gentleman yields. I would like to thank our witnesses for being here today. Members may have additional written questions for you. I'll remind members that they have 10 business days to submit additional questions for the record, and I ask the witnesses to do their best to submit responses within 10 business days upon receipt of the questions. In addition, any materials or responses requested to be submitted to the committee should be submitted within 10 days as well.
I ask unanimous consent to insert into the record the documents included on the staff hearing documents list. Without objection, that will be the order. Without objection, the subcommittee is adjourned.