This chapter introduces the major components of the Water Quality Act of 1987. The chapter guides the reader through the six major titles included in the Water Quality Act, and describes the various programs and functions. The chapter also provides in-depth discussion of the elements of the Clean Water State Revolving Fund program, including the use of leveraging, the reporting and accountability elements of the program, and mechanisms such as the Letter of Credit and the importance of state primacy.

The period of initial state implementation of the Water Quality Act was a critical period in the development of the Clean Water State Revolving Fund (CWSRF). This chapter tests the propositions inherent in the CWSRF that states possessed the administrative, budgetary, political, and organizational resources necessary to implement the program successfully. Drawing on data from EPA and the states, combined with data from a 1990 survey of state program coordinators, this chapter examines the factors critical to state program design and implementation in the early years of the program. The findings from the 50-state analysis suggest that while some states had adequate resources available, many states struggled to balance the environmental and financial elements of the program. The data indicate that some states turned to the private sector for financial assistance, particularly states that chose to leverage their CWSRF capitalization grants. Some states moved quickly with program implementation, while other states proceeded more slowly. The findings highlight the differences in state resources available, and their willingness and ability to implement the program.

The Water Quality Act contained language that expressed the intent of Congress for the Clean Water State Revolving Fund (CWSRF) program to serve certain classes of communities: communities with significant environmental need, communities with populations less than 10,000, and communities facing financial hardship. In addition, Congress allowed CWSRF funds to be used to fund nonpoint pollution projects. Using data from EPA in conjunction with other data, a series of regression models are presented to determine the factors and conditions that lead states to meet these uses. The models and hypotheses tested in this chapter are developed in Chapter Six. Using data for all 50 states measured between 1988 and 2016, the models indicate that factors over which states have control- whether to leverage, the program structure, and others- determine the ability of states to meet the needs of most categories of applicants. State political factors are less important, although demographic variables do provide some explanatory power. Water quality needs matter for communities with significant environmental need. The results also indicate that communities facing financial hardship are not being well served by the program.

This chapter presents in-depth case studies of initial implementation of the Clean Water State Revolving Fund (CWSRF) program. The four states chosen- Alabama, California, Georgia, and New York- represent states that took very different approaches to initial implementation: Alabama represents a state with a highly leveraged program and significant private sector involvement; California is a state with large needs that did not leverage; Georgia is a state that did not leverage and implemented the program without private sector involvement; and New York had huge needs but was delayed in implementation. Data are drawn from state documents, survey data, and in-depth interviews conducted with state program administrators. The case studies highlight the unique circumstances present in each state, and how these circumstances shaped the implementation decisions and, ultimately, the nature of the program developed in the state.

This chapter explains why horizontal (or general purpose) search should be seen as a natural monopoly. First, it shows that a horizontal search like Google Search is characterized by a cost structure with high fixed costs and very low marginal costs on the supply side, as well as extensive economies of scale generated by data that increase the efficiency of search results in terms of quality-adjusted costs. This chapter then discusses the regulatory implications arising from the natural monopoly framework, including the ability to exercise market power both on the searchers and advertisers’ side, and inventives to leverage market power through discriminatory behavior in vertically related markets.