Bridge (Loan) Over Troubled Water

By: David Ullman

13th March, 2015

On September 16, 2014, the federal Environmental Protection Agency (“EPA”) rejected the vast majority of a low- cost loan request from the administration of New York State Governor Andrew Cuomo to help finance a replacement for the aging Tappan Zee Bridge across the Hudson River approximately 25 miles north of midtown Manhattan. The decision was hailed by environmental advocates who had argued that the federal funding, authorized by a 1987 amendment to the landmark Clean Water Act (“CWA”), should be reserved for “genuine environmentally beneficial projects” such as those financing municipal wastewater facilities and improving water quality. The federal rejection of $481.8 million in funding was also notable in that the full $510.9 million request had been approved by the agency responsible for managing the revolving loan fund, the New York State Environmental Facilities Corporation (“EFC”).

New York State has maintained its position that the bridge replacement projects are eligible for funding—and on November 13, submitted an administrative appeal prepared by outside counsel to the EPA. The appeal proposes several grounds for a reversal, but the main dispute between the EPA and the EFC presents a compelling legal question: does Section 603(c)(3) of the Clean Water Act require, as the EPA and environmental advocates suggest, that eligible revolving fund projects improve water quality? Or, as the State contends, may projects merely implement a conservation and management plan that maintains the chemical, physical, and biological integrity of an estuary?

While both sides claim that the text of the authorizing legislation is clear enough to ascertain congressional intent behind the law, legislative history may be examined in cases of genuine textual ambiguity. This Field Report argues that the Joint Explanatory Statement of the Committee of Conference in the Water Quality Act Conference Report suggests that Congress did indeed intend to promote water quality through the state revolving funds, supporting the EPA’s interpretation of the law.

Download the PDF file .