IAPMO’s view from the Hill, and the Industry

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Dain Hansen is vice president of Government Relations, The IAPMO Group. He lends his frequent perspective of Capitol Hill, and the plumbing industry.

Here is an edited version of his update from May 8:

• Taxation of Intellectual Property. One issue that continues to receive notoriety following a Senate committee hearing this week is the tax treatment of intellectual property (IP). The idea of a “patent box” was noteworthy in that it received considerable attention at the hearing from senators on both sides of the aisle. This concept, which has already been adopted by some European countries, would provide a discounted corporate tax rate on income associated with certain IP. Several lawmakers believe that in order to remain competitive in the international market, more than just a reduction of the corporate tax rate is needed. It is expected that patent box legislation will be introduced and to gain some traction as tax reform continues its slow walk toward consideration.

Californians Have A Long Ways To Go When It Comes To Meeting New Water Restrictions. That became painfully clear Tuesday when the state released new data showing that cities and towns reduced their consumption a mere 3.6 percent in March — compared with the same month in 2013 — just as officials took the unprecedented step of mandating cuts of up to 36 percent. How California can bridge that chasm is now one of the state’s most vexing questions. The cuts are set to take effect June 1. “This is a moment to rise to an occasion,” said Felicia Marcus, chair of the State Water Resources Control Board, which approved the first-ever water reductions as part of an emergency drought package Tuesday night. “We’re taking this step because of what we’re facing.” Anticipating that California water supplies will continue to dwindle amid a fourth consecutive dry year, the new regulation commits each of the state’s 400 largest water agencies to cutbacks of 4 to 36 percent compared with what they used two years ago. Agencies that have used more water in the past face steeper targets on a nine-tier scale of reductions. Agencies that don’t hit their state target face penalties of $10,000 a day. How and when the state will begin enforcement remains unclear. A state economic analysis, meanwhile, estimates that water agencies stand to forfeit more than $500 million in revenue over the next nine months as a result of selling less water under the regulation. State water officials expect the biggest conservation gains to come through declines in outdoor watering, which can make up to 50 percent or more of a household’s use. To that effect, the new regulation expands an existing list of outdoor watering rules by banning communities from irrigating median strips with potable water and requiring developers to install drip or micro-spray systems at new homes and businesses. These provisions take effect immediately.

VA Hospital in PA Says Fatal Case of Legionnaires Not Acquired At Its Facility. The Veterans Affairs Pittsburgh Healthcare System has found no evidence that its Oakland campus caused a fatal case of Legionnaires’ disease last month, spokesman Donald Manuszewski said Thursday. The VA has done about 30 water tests in and near the area where the patient received care before his diagnosis April 21, Manuszewski said. He said none revealed Legionella, the waterborne bacteria that can cause the disease. “We continue to believe that it was community-acquired,” he said of the case. The patient died early April 22. Manuszewski said he did not know whether water tests at the patient’s home or workplace have turned up the bacteria. The Centers for Disease Control and Prevention in Atlanta is helping investigate, running tests to identify the type of Legionella involved.
Recycled Drinking Water—Getting A Second Look. Water spilled out of a spigot, sparklingly clear, into a plastic cup. Just 45 minutes earlier, it was effluent, piped over from Orange County’s wastewater treatment plant next door. At a specialized plant, it then went through several stages of purification that left it cleaner than anything that flows out of a home faucet or comes in a brand-name bottle. “It’s stripped down to the H, 2 and O,” said Mike Markus, the general manager of the county water district. He was not exaggerating. Without the minerals that give most cities’ supply a distinctive flavor, this water tastes of nothing. As California scrambles for ways to cope with its crippling drought and the mandatory water restrictions an array of ideas that were long dismissed as too controversial, expensive or unpleasant are getting a second look. One is to recycle the water Californians have already used. And therein lies a marketing challenge that can be even greater than the technological one. Water recycling is common for uses like irrigation; purple pipes in many California towns deliver water to golf courses, zoos and farms. The West Basin Municipal Water District, which serves 17 cities in southwestern Los Angeles County, produces five types of “designer” water for such uses as irrigation and in cooling towers and boilers. Efforts in the 1990s to develop water reuse in San Diego and Los Angeles were beaten back by activists who denounced what they called, devastatingly, “toilet to tap.” Los Angeles built a $55 million purification plant in the 1990s, but never used it to produce drinking water; the water goes to irrigation instead. But with the special purification plant, which has been operating since 2008, Orange County swung people to the idea of drinking recycled water. The county does not run its purified water directly into drinking water treatment plants; instead, it sends the water underground to replenish the area’s aquifers and to be diluted by the natural water supply. This environmental buffer seems to provide an emotional buffer for consumers as well. The $481 million plant opened during a previous drought.
However, opponents of reusing water have long had the upper hand, said Paul Slovic, a professor of psychology at the University of Oregon, because of the “branding problem.” People tend to judge risk emotionally, he said, and a phrase like “toilet to tap” can undercut earnest explanations. “The water industry has not been good at marketing reuse,” he added. But research has shown that highlighting the benefits of recycled water — and the need — can shift emotions to a more positive reaction and help diminish the sense of risk. Cities such as Wichita Falls and Big Spring, Tex., have put purified water directly into the drinking supply without incident. Wichita Falls has been using its system since July 2014.
• Backflow Preventers And Water Meters Being Stolen In Arizona. Police in Peoria, Arizona say they’re investigating a series of thefts of backflow preventers and water meters in the city. Police say the majority of the thefts involved units connected to fire hydrants, but additional units have been taken from standing caged locations that are welded to copper stand pipes. The number of thefts over the past two months has been increasing. Each of these thefts costs private businesses, the city and taxpayers between $1,000 and $2,500 per unit. Police are having a hard time catching the suspects as the thefts have occurred at all times of the day. Recently, video surveillance captured a possible suspect vehicle and a man driving the vehicle and police are now working to find the man and the car.

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