By Thomas Black / Bloomberg Opinion
Out of the more than $3 trillion of new spending approved since 2021, the most basic and important part of infrastructure is being shortchanged. Again.
Under the Infrastructure Investment and Jobs Act, $55 billion is about to start flowing to improve the nation’s wastewater and drinking water systems. That sounds like a lot of money, but it pales in comparison with the $110 billion for roads and bridges, is less than the amounts for broadband internet ($65 billion) and Amtrak ($66 billion) and is on par with the $50 billion for projects to protect against droughts, heat, floods and wildfires.
Those are all worthy endeavors, of course, but the ability to flush the toilet and drink water from the tap without catching a disease is the most significant infrastructure for communities, and the work to maintain them has been neglected for decades.
“We have long lost the war on keeping a regularly scheduled upgrade of the U.S. water infrastructure,” said Deane Dray, an analyst with RBC Capital Markets, who covers industrial companies.
Mayors don’t brag about how much of their budget they spend on repairing leaks or overhauling a pump at a treatment plant, and it’s a tempting place to cut costs. The systems are underground or tucked in a remote area that’s fenced off from the public. Nobody cuts a red ribbon with a giant pair of scissors for a water system upgrade. People are more likely to curse these projects because streets are being torn up to repair pipes. Having clean, running water available for households and businesses is taken for granted; until the systems break and the urgency is all too real.
Consider Jackson, Miss., whose deteriorating water system had caused problems for years until a flood recently caused it to fail, leaving 150,000 residents without running water. Or recall Flint, Mich., where contaminated water exposed tens of thousands of residents, including especially vulnerable children, to unacceptably high levels of lead because of corroded pipes. Many of the most rundown systems are in communities with a large percentage of low-income and minority populations.
The nation’s water and wastewater market is about $150 billion a year, and about 70 percent of operating expenses are for “break-and-fix” work, according to RBC Capital Markets. Growth of the market is about 4 percent to 6 percent and is defensive because most of the spending must be done to keep potable water running. The market amount would be much higher if the U.S. decided to catch up on the required maintenance work.
The water problem is widespread. Relatively wealthy states like Alaska and Texas have a much higher percentage of their public water systems in an enforcement priority, which is designed to get them back into compliance under the Safe Drinking Water Act, than the national average of 3 percent. Systems in Mississippi and Arkansas are well below that average, according to data from the Environmental Protection Agency.
Out of the $55 billion for water infrastructure spending, $15 billion is earmarked for replacing lead pipes. It should be astonishing that many cities don’t even know how much lead pipe is in their systems, and a chunk of this money will be used only to compile an inventory on pipes that need to be replaced. The money may cover a quarter of the need for lead pipe replacement. The use of funds under the American Rescue Plan was expanded to include replacement of lead pipes, but it seemed more of an afterthought.
About $23 billion over five years will be split evenly between projects for drinking water and wastewater. This money will flow through state revolving funds, which is a well-established mechanism for distributing water funds. An additional $800 million annually over five years will assist cities on emerging contaminants, such as polyfluoroalkyl substances, known as PFAS, certain types of which are known as forever chemicals because they accumulate in the body and break down slowly in the environment.
Compared with the law’s overall spending of $550 billion, water’s share for these critical priorities seems woefully inadequate.
There’s a lot of catching up to do on water infrastructure. The older and poorer the city, the bigger the need. Local governments also must be frank with their citizens about the costs to operate and properly maintain a water system. Subsidizing the cost of water discourages conservation. The burden is lower for rich communities awash in property taxes or sales taxes and that have newer systems. It shouldn’t take a crisis every few years to get everyone behind the need to spend more for reliably clean water.
Thomas Black is a Bloomberg Opinion columnist covering logistics and manufacturing.
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