Beyond Tariffs

By Kerry Stackpole

With precious water resources and the trade relationships of its members at stake, Plumbing Manufacturers International (PMI) continues to actively engage on a variety of issues at the federal level in Washington, D.C.

Tariffs continue to be an issue for plumbing manufacturers, with the ramifications of these duties expected to impact the industry well into the future. While tariffs grab the headlines, the Environmental Protection Agency’s WaterSense program and the United States Mexico Canada Agreement (USMCA) will continue to be important advocacy issues in the months ahead.

Securing WaterSense

PMI achieved an important preliminary victory in May by having association-supported language calling for the preservation and funding of the WaterSense program included in the House Appropriations Committee’s fiscal year 2020 Department of the Interior-EPA spending bill. By a vote of 30-21, the bill passed and was an important step in response to President Donald Trump recommending the elimination of the program. As a result, PMI is optimistic WaterSense program will be preserved in the fiscal year 2020 budget.

This good outcome was due to hard work by PMI members and coalition partners who advocated for WaterSense in meetings and calls with dozens of members of Congress over the past several months. PMI federal government affairs consultant Stephanie Salmon spearheads this effort for PMI.

A big part of her job is to obtain legislator support for the WaterSense program. In the House on the WaterSense issue, she and our partners have been working very closely with Interior-EPA Subcommittee chair Rep. Betty McCollum (D-Minn.) and ranking member Rep. David Joyce (R-Ohio), as well as with Steven Palazzo (R-Miss.), Norma Torres (D-Calif.) and others. The recently passed bill will go before the full House this summer for approval.

The Senate has the same budgeting structure, with an Interior-EPA Subcommittee and Senate Appropriations Committee. PMI is working closely with WaterSense supporters Lamar Alexander (R-Tenn.), Tammy Baldwin (D-Wis.), Lindsey Graham (R-S.C.), Lisa Murkowski (R-Alaska), Tom Udall (D-N.M.) and others to achieve a positive outcome in the Senate.

After the House and Senate budgets are passed, the differences will be ironed out in a conference committee before the entire budget goes to President Trump for his signature before the new fiscal year begins on Oct. 1.

$1,100 Saved for Every Dollar Spent

PMI is optimistic about preserving and maintaining WaterSense due to the goodwill the program’s partners have established with legislators, EPA staff and consumers. The program’s achievements speak for themselves: more than 3 trillion gallons of water and billions of dollars in water and energy expenses saved over the past decade on a $3 million annual budget. The EPA’s inspector general reported that consumers saved an estimated $1,100 for every federal dollar spent on the program.

To bear the WaterSense label, plumbing products must achieve independent third-party certification by demonstrating 20 percent greater water-efficiency than standard products while meeting performance standards. Today, nearly 28,000 WaterSense-labeled product models include a wide variety of showerheads, toilets, faucets, faucet accessories, flushing urinals, and flushometer-valves.

More than 2,000 WaterSense partners participate in the program, including all major U.S. plumbing manufacturers, water utilities, builders, retailers, distributors, consumer groups, water efficiency advocates, and communities, all of which collaborate with EPA to make this program successful.

The program provides a water efficiency benchmark for plumbing products that has allowed PMI members to confidently invest millions of dollars in product development and marketing initiatives – efforts that have saved water and energy expenses for consumers.

The next step for the USMCA

With the USMCA signed by the three North American trading partners, the next step in the United States is ratification by Congress. Ratification requires two-thirds of the Senate to vote yes. The USMCA updates the North American Free Trade Agreement (NAFTA) by increasing environmental and labor protections and by creating more incentives for the domestic production of cars and trucks. USMCA also updates intellectual property protections, adds provisions relating to digital trade, and improves transparency.

The plumbing manufacturing industry supports the USMCA because the agreement will continue the growth of cross-border trade and investment, bolstering the economic growth of all three nations. The United States is the largest provider of plumbing products into Canada’s and Mexico’s marketplaces, with a 41 percent share of Canada’s import and a 54 percent share of the Mexican market, according to the International Trade Administration’s (ITA) Building Products and Sustainable Construction Top Markets 2016 Report.

PMI and its members believe that the USMCA will level the playing field for manufacturers by providing the same binding enforcement for all obligations, from commercial issues to labor and environment. The continued success of U.S. plumbing manufacturing depends on critical North American partnerships. Ratification of the USMCA will help plumbing manufacturers to complete globally, grow in the United States, and support well-paying manufacturing jobs across the country.

Water Infrastructure Funding

Whether or not Congress will be able to pass a large infrastructure package remains to be seen. In the meantime, PMI continues to advocate for water infrastructure programs to be included in the fiscal 2020 budget.

These programs include:

• Tax-exempt bonds, similar to Move America Bonds or Build America Bonds, that provide state and local governments and private-sector purchasers with tax credits for investment in public infrastructure.
• A national infrastructure bank (initially capitalized by a federal investment) that would offer long-term, low-interest loans for projects larger than $100 million that contribute to goals of regional or national importance and are backed by an identified revenue stream that repays the loan.
• Expanded federal credit assistance programs – such as Transportation Infrastructure Finance and Innovation Act (TIFIA) – to support large infrastructure projects and leverage additional private resources.

In addition, PMI is advocating for continued or increased funding for the Clean Water State Revolving Fund, Drinking Water State Revolving Fund, Water Infrastructure Finance & Innovation Act, and grants for schools to replace fountains installed before 1988.

By the time the summer draws to a close, the plumbing manufacturing industry will see the fruits of its advocacy efforts; in the meantime, we remain optimistic that the benefits of WaterSense, the USMCA and water infrastructure investment will be seen as very obvious to the decision makers in our nation’s capital.

Kerry Stackpole, FASAE, CAE, is the CEO/executive director of Plumbing Manufacturers International