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Report measures federal agencies’ stepped up role in water infrastructure

Source: Bluefield Research, Boston

Federal government participation in rehabilitating U.S. water utility infrastructure is taking on even greater importance than in the past as municipalities are challenged to keep pace with the aging of 70,000-plus water & wastewater treatment systems and 3 million miles of underground pipe networks. With overall public spending on water utilities declining year-over-year in five of the last 10 years, core federal programs are proving to be more critical in addressing investment needs in urban and rural treatment systems and networks, according to water market-wise Bluefield Research. 

The nation's infrastructure investment needs are evident in market research firm’s ongoing analysis of municipal utility capital improvement plans (CIP) and annual State Revolving Funding (SRF) requests. In 2018, analysis of utility planning documents resulted in as much as $68 billion in capital needs for water & wastewater infrastructure, annually, over the next decade. At the same time, $82 billion was requested from state administered SRF programs for clean (wastewater) and drinking water projects, up from $64 billion in the prior year. With only $15.2 billion awarded though SRF, the gap between utilities' investment needs and available spend is clearly widening.

"SRF loans and grants, which make up 60 percent of government allocations, are more important than ever as the financial burden falls increasingly on local communities," says Bluefield Research Director Erin Boney Casey. "Some states like Ohio are more proactive in supporting requests, while surprisingly, other state funds in Arizona and Tennessee, for example, are underutilized. Navigating these processes can be a challenge and, in fact, technology and equipment vendors are now recognizing the opportunity to support utilities in the application process."

Bluefield Research's new report, Funding U.S. Water & Wastewater Infrastructure: Analyzing Government Sources for Project Development, examines $25.3 billion of loans and grants distributed in 2018 through Environmental Protection Agency SRF; U.S. Department of Agriculture Loan & Grant and Bureau of Reclamation Programs; and, Water Infrastructure Finance and Innovation Act mechanisms. These funding sources, which address varying geographic needs and project sizes, typically receive bipartisan support and are expected to remain as water and wastewater system mainstays in the absence of a sweeping infrastructure act from Washington, D.C.