Clean Water Act Amendments of 1981

Clean Water Act Amendments of 1981 - Amends the Clean Water Act (also known as the Federal Water Pollution Control Act) to revise provisions for Grants for Construction of Treatment Works (title II).

Prohibits Federal grants, after October 1, 1981, which provide assistance only for facility plans, or plans, specifications, and estimates for any proposed construction of treatment works. Provides that non-Federal funds expended during the facility planning and advanced engineering and design phase shall be reimbursed at the prevailing Federal share, if the proposed project later receives a Federal grant for construction.

Prohibits grant approval until the Administrator of the Environmental Protection Agency (EPA) and the State have reviewed and approved plans, specifications, estimates, compliance with specific Federal laws, and a grant payment schedule.

Lowers the Federal share for treatment works grants (from 75 percent in fiscal year 1981) to 65 percent for fiscal years 1982 through 1984 and to 55 percent thereafter.

Requires that treatment works grants be made only for: (1) secondary treatment or more stringent treatment, or any cost-effective alternative; and (2) new interceptors and appurtenances.

Revises formulas for determining the amount of any grant, made after September 30, 1978, for treatment works using innovative or alternative wastewater treatment processes.

Extends the definition of the term "eligible treatment works" to cover those that can be fully funded by States in fiscal years beyond fiscal year 1981 (and which meet specified other requirements).

Makes available to the Administrator specified additional funds per fiscal year to be used to address water quality problems of bays and estuaries due to discharges from combined storm water and sanitary sewer overflows, not otherwise eligible for Federal payments for treatment works. Authorizes the use of such funds upon the request of and demonstration of water quality benefits by the Governor of an affected State.

Revises conditions on treatment works grants to prohibit grants to construct that portion of the treatment works providing reserve capacity (except for specified planning and preparation grants). Directs the Administrator to base determination of size and capacity of the eligible treatment works upon 1980 population statistics.

Requires grant applicants to identify the engineer or firm responsible for architect-engineering or supervisory services for treatment works construction. Requires such engineer or firm to acknowledge such responsibility in writing and to give a two-year warranty of performance of such works according to specifications. Provides for resolution by binding arbitration of disputes about the nature of the responsibility of the engineer or firm.

Sets forth formulas, schedules, and procedures for the allotment of funds for treatment works grants in fiscal years 1982 through 1985.

Extends a formula for specified State and territorial allotments, as well as an authorization of appropriations for such allotments, through fiscal year 1985.

Sets forth a formula for reserving specified funds from each State's allotment for fiscal year 1982 and thereafter. Authorizes the Administrator to reserve an additional amount from State allotments to be available to States, local governments, or multijurisdictional agencies for: (1) water quality management decision-making as to treatment works construction; and (2) implementing provisions for water quality standards and implementation plans.

Extends through fiscal year 1985 requirements that specified minimum amounts be expended from State allotments to increase the Federal share of grants for construction of treatment works utilizing innovative processes and techniques. Revises formulas for determining such amounts.

Lowers the amount authorized to be appropriated for fiscal year 1982 for treatment works construction grants. Authorizes appropriations, in such lowered amount, for fiscal years 1983 through 1985 for such purpose.

Eliminates provisions for project priority that relate to: (1) specified categories of projects; (2) required allocation of funds; and (3) the authority to remove a project from a State's priority list. Provides that the determination of priority shall be made by the State in which the projects are to be constructed, consistent with the treatment works grants provisions of such Act. Limits projects included on a State's priority list to those eligible for funding under specified provisions. Directs a State to give highest priority to projects which demonstrate that significant public health or water quality benefits will be achieved, and in particular to projects having the greatest effect on water quality improvement.

Requires that the review, revision, adoption or promulgation of revised or new water quality standards, pursuant to specified provisions of such Act, be completed two years after the enactment of this Act. Requires that, to the extent practicable, the establishment of total maximum daily loads of pollutants, pursuant to specified provisions, also be completed by such date.

Extends to July 1, 1988, the period for which the Administrator may issue or modify permits to extend compliance deadlines for specified effluent limitations, in cases where reductions in the amount of financial assistance or changed construction conditions beyond the control of the owner or operator will make it impossible to complete construction by July 1, 1983. Repeals a provision that all publicly owned treatment works must comply by a certain date with specified requirements for study and evaluation of alternative waste management techniques and for application of best practicable waste treatment technology.

Provides that, for purposes of specified information and guidelines provisions, certain types of facilities shall be deemed the equivalent of secondary treatment upon a showing satisfactory to the Administrator that water quality will not be adversely affected.

Directs the Administrator, in cooperation with the States, to submit to the Congress, within 18 months, a report: (1) identifying those publicly owned treatment works needed to comply with specified requirements and standards; and (2) taking into account all actions of the Administrator pursuant to specified provisions, estimating the total cost and the Federal share necessary for the construction of such works.