Earlier this month, the United States EPA and FEMA entered into a Memorandum of Understanding (MOU) aimed at facilitating quicker disaster response times by increasing coordination between the two agencies to provide disaster relief in the form of State Revolving Fund (SRF) programs.  The agreement was likely spurred by recent struggles to provide assistance following hurricane events, especially Hurricane Maria in Puerto Rico, and other infrastructure failures such as those experienced at the Oroville Dam in 2017.

The MOU is authorized under a combination of the Stafford Act (42 U.S.C. § 5121 et seq.), Clean Water Act (33 U.S.C. § 1383), and Safe Drinking Water Act (42 U.S.C. § 300j-12).

The MOU provides a framework for the two agencies to work collaboratively in order to minimize red tape and other hurdles that are inconsistent with the needs of emergency response.  Four key agreements provide the substance for the MOU.  First, the EPA will provide a funding process for SRF programs to use SRF funds to cost share and provide loans for immediate recovery needs.  Through this agreement, SRF funds lose their federal status and, therefore, may be used for eligible recovery activities identified by the EPA under the Clean Water Act, the Water Resources Reform and Development Act, and the Safe Drinking Water Act.  This mechanism relaxes the requirements of non-federal entities paying back a cost share because non-federal funds are subject to fewer compliance burdens.

Second, the EPA has reviewed and acknowledged that the SRF State Environmental Review Process is substantially similar to the requirements under the National Environmental Policy Act (NEPA).  Since the funds provided are non-federal, they must comply with applicable State processes.  This “rubber stamping” of the state processes on an emergency basis is further aimed at streamlining the environmental review process to provide faster reaction times.

Third, the EPA has authorized the response projects to waive out of requirements regarding the use of American iron and steel, if they are FEMA funded.  Typically, the EPA requires that new water infrastructure projects use American sourced iron and steel.  In assessing the applicability of this waiver, EPA takes into account circumstances of public interest, product availability, and product cost.  This waiver should hasten response times due to the ability to source infrastructure materials from the most cost and time efficient sources.

Fourth, the EPA and FEMA have agreed to develop new information sharing policies to initiate faster information dissemination and coordination between the entities.  The goal is to provide early access to the SRF.  The SRF programs can similarly provide the information they discover on first examination to both FEMA and EPA to further coordinate assistance.  These measures are intended to prevent duplication of work, fraud and waste.

A copy of the MOU is available here.

For additional information on this MOU and other water infrastructure and licensing issues, please contact Palmer Hilton at philton@somachlaw.com or 916-446-7979.

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