Major water companies want Congress to allow them to make greater use of tax-exempt financing in exchange for helping address the trillion-dollar maintenance needs of the nation's crumbling water and sewer grid.

The National Association of Water Companies (NAWC) -- a group of private utilities and utility operators that includes industry heavyweights Veolia Water, American Water and CH2M HILL OMI -- sent 50 of its members to Capitol Hill this week to drop in on more than 200 congressional offices. Their message: With more tax-free financing options, the private sector could leverage as much as $475 billion to invest in aging pipelines and upgrade overburdened water treatment systems across the United States.

The industry wants lawmakers to free it from the cap on bonds that governments may issue on behalf of private projects, called private activity bonds. The change, which the House passed twice last year as part of two larger pieces of tax legislation but which failed to pass in the Senate, would "level the playing field" between public and private utilities, according to Lisa Sparrow, the association's president-elect and the president & CEO of Utilities Inc.

The timing is right, Sparrow added, since government at every level is moving to slash spending -- especially on water infrastructure.

"It's the exact reason why this is a good time to level the playing field," Sparrow said. "Because there is private money available for these types of projects."

The group also wants Congress to give private companies access to federal matching loans made available to public wastewater systems to perform upgrades through what is called the Clean Water State Revolving Fund. Private companies already may tap into the equivalent for drinking water systems, called the Drinking Water State Revolving Fund. Both funds are slated for a steep, $947 million cut in President Obama's proposed budget for 2012.

"I don't actually think there's a credible argument for not allowing private water service providers access to the clean water revolving funds," Sparrow said.

Although water companies are generally lesser-known than their peers in the energy sector, Sparrow said the industry's profile has risen as major pipelines are bursting more frequently across the United States, calling attention to the potential for a nationwide water infrastructure crisis.

The lobbying blitz came as an unlikely alliance of water, agricultural, environmental and educational interests organized by the Johnson Foundation at Wingspread added 55 new members to its initiative to stave off a freshwater crisis.

The new members of the "Charting New Waters" initiative, launched last September, include the American Farmland Trust, Nature Conservancy and Veolia.

The group has called for forming a national commission on water to make recommendations on how to address challenges the challenges of waters supply and quality, the effects of climate change, and public and environmental health (E&E Daily, Sept. 15). It also seeks to focus attention on the "energy-water nexus," or the vast amounts of water required to generate electricity.

"These newest alliances represent significant progress in bringing together the best and brightest and demonstrate that there is major support from a diverse set of stakeholders eager to take a leading role in improving our nation's freshwater policy," said Lynn Broaddus, director of environment programs at the Johnson Foundation at Wingspread.