17th Annual Municipal Survey

In Search Of The Silver Lining
By Robert Carpenter, Editor | February 2014, Vol. 69 No. 2

Despite Continuing Funding Concerns, Budgets Expected To Rise

When the Federal deficit began to slowly climb during President George W. Bush’s administration, it caused many raised eyebrows and several economists voiced concerns about the long-term economic impacts. Still, the United States stayed its course.

But with the skyrocketing deficit that has been symptomatic of President Obama’s administration (and still climbing), concerns about funding issues have reached a fever pitch on the political stage. There is no longer any doubt of the negative implications such a heavy debt burden is having upon our economy and indeed, our society.
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Efforts to raise spending at the Federal level – no matter how important – are being stonewalled at every corner. Rare is the Congressman or Senator who dares suggest increased spending – and justifiably so. However, for the much maligned, aging and failing sewer and water infrastructure, falling Federal funding sources have caused a near-panic for some cities and a wild scramble by many others to not only locate other funding sources, but find a way to pay back infrastructure loans. Gaining additional funding at state levels is meeting a similar slate of challenges from local municipalities.

Worse, large cities such as Bakersfield, CA, Birmingham, AL, and Detroit, MI, have declared bankruptcy. While the justifications for declaring financial insolvency by these cities are many, the net result for the underground infrastructure is that it plummets into an even worse state of decay while the courts and cities try to sort things out.
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With that backdrop of money woes, it is no wonder that funding issues are the number one concern for more than 80 percent of municipalities across the U.S. These results were revealed in the 17th Annual Underground Construction Municipal Sewer & Water Survey. The research includes a detailed look at 2014 underground infrastructure spending plans for America’s cities along with insights and perspectives on industry topics and issues from the municipal perspective.

Good news for spending

Despite strong, continuing funding concerns by cities, for the first time in several years, municipalities as a whole are expecting a substantial increase (7.7 percent) in new construction pending for 2014. This optimism runs counter to what many expert prognosticators are predicting for the public infrastructure market in 2014. In total, new construction for sewer/water/storm water piping infrastructure is expected to approach $9.1 billion this year.