Revolving No More: How Earmarks Undermine Funding for Water Infrastructure

By Katy Hansen and Janet Pritchard

Coming Soon!

Congressional earmarks taken from federal appropriations for the State Revolving Funds (SRFs) have fundamentally altered water infrastructure funding to the clear detriment of the vast majority of states. EPIC’s report clearly shows that earmarks create both short- and long-term losses for states.

• Earmarks undermine the long-term durability of SRFs by eroding the revolving fund mechanism; each earmark permanently eliminates future financing for a similar-sized water project in the same state. 

• Even Congressional offices that are very successful at earmarking often end up reducing the total amount their states will have for water infrastructure. For example, Florida legislators locked down almost $300 million in clean water earmarks in 2023-2024, but the state will receive millions less in funding over the next 20 years than if they had left the SRFs alone.

• Earmarks fund projects in larger and more affluent communities, compared to SRF assistance allocated by states.

• Earmarks reduce the amount of technical assistance and principal forgiveness states provide, primarily hurting the small and rural communities most likely to receive principal forgiveness and technical assistance.

EPIC’s Report on SRF Earmarks provides thoughtful, compelling data and policy analyses to support actionable recommendations for how Congress could make earmarking less harmful to their own states. The SRFs are one of America’s best ideas in infrastructure finance. The most striking conclusion from this work, however, is that there is almost no way for Congress to earmark a loan program and not do damage to its long-term sustainability.

As EPIC’s report clearly demonstrates, most Congressional offices that secure earmarks are actually reducing the total future funding for their state.