There are 2.2 million miles of drinking water pipelines throughout the U.S. @AWWAACE says most of our buried drinking water infrastructure was built 50 or more years ago, in the post-World War II era of rapid demographic change and economic growth. In some older urban areas, many water mains have been in the ground for a century or longer. So, it’s no surprise that a large proportion of US water infrastructure is approaching, or has already reached, the end of its useful life.
Yet, many drinking water utilities are only in the very early stages of developing an asset management program. Most survey respondents to @EPA survey on baseline pipe replacement rates, indicate water utilities replacement of aging drinking water pipes is 0.5% per year, or 10 percent over 20 years. This rate of drinking water asset management suggests pipelines can last 200 years. @ASCETweets estimates there are 240,000 water main breaks occurring every year in the U.S., wasting over two trillion gallons of treated drinking water.
@EPA’s 6th Drinking Water Needs Assessment Report to Congress estimates a total 20-year capital improvement need of $472.6 billion in the U.S.
The facts are clear; the longer we wait on replacing drinking water infrastructure in the U.S. the more costly it will become. In fact, a recent @michiganstateu study highlighted that between 2010 and 2015 water costs rose 41%. Results of the study also highlight that while water rates remain comparatively affordable for many U.S. households, this trend will not continue in the future. If water rates rise at projected amounts over the next five years, conservative projections estimate that the percentage of U.S. households who will find water bills unaffordable could triple from 11.9% to 35.6%.
Congress Acts & Provides Needed Funding
Congress enacted the FY 2018 Omnibus Appropriations Bill on March 22. It provides the existing @EPA program WIFIA $5.5 billion in credit assistance for water infrastructure projects. This financing will help support approximately $11 billion in total infrastructure investment. It is estimated that 60% of total investment will be directed to drinking water pipelines.
Are States & Local Jurisdictions Infrastructure Financing Stretched?
It must be acknowledged that WIFIA is a loan program. The program assumes states and local jurisdictions haven’t already stretched their infrastructure financing capabilities. For instance, across the U.S. a majority of counties are considered rural with populations under 50,000. A question remains how many of these counties are in a financial position to undertake WIFIA-sized projects with $20 million being the minimum loan amount for large communities. For counties with populations of 25,000 the minimum loan amount for WIFIA projects is $5 million. One solution is these counties could engage in a joint effort with other municipalities to fund drinking water projects.
@leagueofcities 2017 City Fiscal Conditions survey of city finance officers reveals “the start of fiscal contraction in the municipal sector following several years of post-recession growth. Several major findings taken together signal a slowdown on the horizon, including waning confidence of city finance officers, slowing local revenue and spending trends and insufficient post-recession revenue recovery.” Factors included:
- General Fund revenues grew by 2.61% in 2016, and revenues are projected to stagnate with just 0.9% growth in 2017,
- Property tax revenue growth is budgeted much lower than 2016. Finance officers have budgeted for 1.6% growth in property tax revenues in 2017, compared to 4.3% in 2016, and
- Finance officers project a decline in sales and income tax revenues for 2017. Both sales and income tax revenues grew in 2016 (by 3.7% and 2.4%, respectively), but finance officers project a decline in 2017 (by 0.2% and 2.7%, respectively).Technology to Help Alleviate Costs
Technology = Solutions
Fortunately for water utilities there are advancements in technologies for water
infrastructure that can help stretch their drinking water distribution asset financing capabilities. Trenchless technologies such as the innovative structural lining, Aqua-pipe (www.aqua-pipe.com/) are being installed in major U.S. cities like Baltimore, Boston, Cleveland, Oakland and Los Angeles. Depending on the size and scope of the project(s) this structural, Class IV trenchless technology can save water systems between 20 and 50 percent off the costs of traditional construction methods of upgrading drinking water pipelines.
When installing Aqua-pipe water systems also achieve the benefits of minimal disruptions, restoring structural integrity of the pipeline and lowering Green House Gas emissions. Aqua-pipe has received certifications from NSF and UL to ANSI Standard 61 and they maintain two decades of experience. Impressively, nearly 4 million feet of Aqua-pipe has been installed throughout North America.