Legislative Analysis
Phone: (517) 373-8080
CLEAN WATER AND SAFE DRINKING WATER ASSISTANCE
http://www.house.mi.gov/hfa
House Bill 5762 as reported from committee Analysis available at
Sponsor: Rep. Beth Griffin http://www.legislature.mi.gov
1st Committee: Natural Resources and Outdoor Recreation
2nd Committee: Ways and Means
Complete to 12-5-20
BRIEF SUMMARY: House Bill 5762 would amend Part 53 (Clean Water Assistance) and Part 54
(Safe Drinking Water Assistance) of the Natural Resources and Environmental Protection Act
to allow certain projects eligible for assistance under those parts to include energy and resource
efficiencies described in the Cost-Effective Governmental Energy Use Act and to modify the
criteria for developing the annual priority list of projects for safe drinking water assistance.
FISCAL IMPACT: House Bill 5762 is not likely to affect costs or revenues for EGLE or local
governments.
THE APPARENT PROBLEM:
According to committee testimony, the funds available from the State Water Pollution Control
Revolving Fund for clean water assistance and safe drinking water assistance loans are
underutilized, with millions of dollars going unused for proposed projects across the state of
Michigan. The bill seeks to expand use of the funds by expanding the kinds of activities that
qualify for a loan.
THE CONTENT OF THE BILL:
Clean water assistance
Part 53 of NREPA provides a process under which the Department of Environment, Great
Lakes, and Energy (EGLE) provides loans and other assistance to municipalities to construct
sewage treatment works projects, stormwater projects, and nonpoint source projects.1
For purposes of the part, the word “project” is defined to mean a sewage treatment works
project, a stormwater treatment project, or a nonpoint source project, or a combination of these.
House Bill 5762 would amend this definition to provide that, for a project that is a combination
of the other kinds of projects, “project” could include utilization of more efficient energy and
resources as described in the Cost-Effective Governmental Energy Use Act (see Background).
1
Nonpoint source projects are construction activities designed to reduce nonpoint source pollution—pollution that
does not come from a clear and confined source of discharge, such as a pipe, ditch, container, well, vessel, etc.
Nonpoint source pollution is more widespread and diffuse; in the words of the EPA, it “generally results from land
runoff, precipitation, atmospheric deposition, drainage, seepage or hydrologic modification.”
https://www.epa.gov/nps/basic-information-about-nonpoint-source-nps-pollution
House Fiscal Agency Page 1 of 4
 Safe drinking water assistance
Part 54 provides a process under which EGLE provides loans and other assistance to public
waterworks systems that provide water for drinking and household purposes.
For purposes of this part, the word “project” is defined to mean a project related to the planning,
design, and construction or alteration of a waterworks system.
House Bill 5762 would amend this definition to provide that the waterworks system could
include utilization of more efficient energy and resources as described in the Cost-Effective
Governmental Energy Use Act (see Background).
The bill would also amend a provision that now requires a project plan analysis to compare
alternative systems by considering their opportunities to make more efficient use of energy and
resources to instead require consideration of opportunities to utilize more efficient energy and
resources as described in the Cost-Effective Governmental Energy Use Act.
Finally, the bill would modify the criteria for developing EGLE’s priority list of projects that
are eligible for safe drinking water assistance under Part 54.
Currently, EGLE must annually develop a priority list of projects eligible for assistance using
a point system based on various criteria. One of the criteria awards a maximum of 450 points
to a project that addresses drinking water quality based on whether the project is designed to
meet four additional criteria, each with their own maximum points.
The bill would increase the total maximum points awarded to 500 and add one more criterion,
under which 50 points could be scored if the project is designed to increase the utilization of
more efficient energy and resources as described in the Cost-Effective Governmental Energy
Use Act.
The bill would also update some state and federal citations, make editorial changes for clarity
and consistency, and add a standard definition for “federal poverty guidelines.”
MCL 324.5301 et seq.
BACKGROUND:
The Cost-Effective Governmental Energy Use Act defines “cost-savings measure” as including
a facility improvement, repair, or alteration, or any equipment, fixture, or furnishing to be
added or used in a facility, that is cost-effective and that is designed to reduce energy
consumption; reduce utility, capital avoidance, capital improvement, maintenance, and
operating costs; or increase revenue or the operating efficiency of the facility for its appointed
functions, such as:
• Replacement or modification of lighting components, fixtures, or systems.
• Renewable energy and alternate energy systems.
• Cogeneration systems that produce steam or forms of energy, such as heat or electricity,
for use primarily within a building or complex of buildings.
• Devices that reduce water consumption or sewer charges, including all of the
following:
House Fiscal Agency HB 5672 as reported from committee Page 2 of 4
 o Water-conserving fixtures, appliances, and equipment, including water-conserving
landscape irrigation equipment, or the substitution of non-water-using fixtures,
appliances, and equipment.
o Landscaping measures that reduce watering demands and capture and hold applied
water and rainfall, including landscape contouring, such as the use of berms,
swales, and terraces, the use of soil amendments, such as compost, that increase
the water-holding capacity of the soil, rainwater harvesting equipment, and
equipment to make use of water collected as part of a storm water system installed
for water quality control.
o Equipment for recycling or reuse of water originating on the premises or from other
sources, including treated municipal effluent.
o Equipment to capture water from nonconventional, alternate sources, including air
conditioning condensate or graywater, for nonpotable uses.
o Metering equipment to segregate water use in order to identify water conservation
opportunities or verify water savings.
• Changes in operation and maintenance practices.
• Indoor air quality improvements that conform to applicable building code
requirements.
• Daylighting systems.
• Insulating the building structure or systems in the building.
• Storm windows or doors, caulking or weather stripping, multiglazed windows or door
systems, heat-absorbing or heat reflective glazed and coated window and door systems,
additional glazing, reductions in glass area, or other window and door system
modifications that reduce energy consumption.
• Automated or computerized energy control systems.
• Heating, ventilation, or air conditioning system modifications or replacements.
• Energy recovery systems.
• Steam trap improvement programs that reduce operating costs.
• Building operation programs that reduce utility and operating costs, including
computerized energy management and consumption tracking programs, advanced
metering, metering and sub-metering, staff and occupant training, and other similar
activities.
• Any life safety measures that provide long-term operating cost reductions and are in
compliance with state and local codes.
• Any life safety measures related to compliance with the Americans with Disabilities
Act that provide long-term operating cost reductions and are in compliance with state
and local codes.
• A program to reduce energy costs through rate adjustments and load shifting to reduce
peak demand, including one or more of the following:
o Changes to more favorable rate schedules.
o Auditing of energy service billing and meters.
• Services to reduce utility costs by identifying utility errors and optimizing existing rate
schedules under which service is provided.
• Any other installation, modification of installation, or remodeling of building
infrastructure improvements that produce utility or operational cost savings for their
appointed functions in compliance with applicable state and local building codes.
• Recommissioning.
House Fiscal Agency HB 5672 as reported from committee Page 3 of 4
 • Retro-commissioning.
• Continuous commission.
• Behavior modification and energy policies.
• Measurement and verification.
• Reporting tools.
• Geothermal.
• Carbon footprint monitoring.
ARGUMENTS:
For:
Because Michigan residents rely heavily on the state’s infrastructure, it is imperative that
projects for clean water and safe drinking water can affordably move forward. Loan
opportunities are at the ready to help Michiganders, and expanding access to those
opportunities helps ensure Michiganders can continue to safely rely on Michigan’s
infrastructure.
Against:
While these loan programs are excellent for contracting work for much-needed infrastructure
projects, the process only works if the details of the projects are clear and manageable. Many
municipalities are nervous about being able to pay a loan, especially when many things can go
awry during the course of completing a project that can ultimately increase the cost of the
project. Critics of the bill argued that the bill should go further in ensuring that project details
are clearly listed and understood before starting a project and that contractors hired to work on
the projects are properly trained so that the projects have a higher success rate.
POSITIONS:
Representatives of Johnson Controls, Inc. testified in support of the bill. (9-15-20)
The following entities indicated support for the bill:
• Department of Environment, Great Lakes, and Energy
• Michigan Environmental Council (9-15-20)
• Michigan League of Conservation Voters (9-15-20)
• American Water Works Association, Michigan Section (9-23-20)
• Michigan Water Environment Association (9-23-20)
• Michigan Municipal League (9-23-20)
• Michigan Townships Association (9-23-20)
Legislative Analyst: Emily S. Smith
Fiscal Analyst: Austin Scott
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations, and does not constitute an official statement of legislative intent.
House Fiscal Agency HB 5672 as reported from committee Page 4 of 4


Statutes affected:
House Introduced Bill: 324.5301