ASA Supports the Water Infrastructure Subcontractor & Taxpayer Protection Act

ASA and similar-minded organizations sent a letter to the House and Senate Transportation Committee Leadership, respectfully requesting the addition of H.R. 1285, the Water Infrastructure Subcontractor & Taxpayer Protection Act, to the agenda of the next markup on pending legislation before the Transportation & Infrastructure Committee. This request aims to advance this critical policy solution, especially following the recent Water & Environment Subcommittee Hearing that highlighted the benefits of the Water Infrastructure Finance & Innovation Act (WIFIA). The legislative hearing underscored WIFIA's impact in addressing America's water infrastructure needs. However, committee members emphasized the need to modernize WIFIA to ensure all projects receiving program assistance are accompanied by payment and performance bonds to safeguard federal investments in the nation's water infrastructure.

Per the letter, “as the committee continues to help the country deliver meaningful infrastructure improvements, we must make certain adequate protections are applied to the construction of our nation’s water infrastructure. Sureties, by way of payment and performance bonds, are common practice on public works projects and are required at the federal level through the Miller Act and at the state level through the Little Miller Acts. Payment and performance bonds play a vital role in ensuring taxpayer resources are not unduly wasted, as a surety steps in to assume the risk in the case any aspect of a project fails to align with the original plan. They guarantee subcontractors, suppliers and workers on public works projects are compensated and projects are completed within budget and on time, even if the lead contractor encounters financial distress.”

The required protections are not consistently applied to newer project deployment forms, such as public-private partnerships (P3s). This inconsistency puts taxpayer funds, subcontractor payments, small businesses, and workers at risk. The Water Infrastructure Subcontractor and Taxpayer Protection Act, H.R. 1285, aims to standardize and de-risk this process by ensuring that water infrastructure projects financed by the WIFIA program use these security protections.