A Jan. 18 Environmental Protection Agency memo could prove crucial in giving communities more flexibility in how they build and pay for major water infrastructure projects, according to water utility groups.

The memo stresses EPA's commitment to work with mayors on how its regional offices evaluate localities' ability to finance water infrastructure programs that are mandated by consent decrees. In June 2012, EPA released a framework, called the integrated planning and permitting process, for giving municipalities more flexibility in scheduling and setting priorities for projects.

Although mayors and water utilities saw the framework as a positive first step, a key sticking point has been the way in which EPA conducts financial capability assessments, says Chris Hornbeck, National Association of Clean Water Agencies senior director for regulatory affairs.

Regional EPA officials typically rely on 1997 EPA guidance that considers only localities' median household income. That guidance, when followed strictly, could lead officials to underestimate a project's financial impact on individual communities, Hornbeck says.