EXCLUSIVE: Underground Construction’s 12th Annual Municipal Survey: Year of Hope and Caution

Recession Causes Budget Concerns While Stimulus Stirs Excitement, Potential Windfalls
February 2009 Vol. 64 No.2

Considering the state of the economy, results from Underground Construction’s 12th Annual Municipal Survey reflected surprising optimism among city personnel across the United States. Understandably nervous and cautious about 2009, municipal personnel expect their funding levels to decline somewhat, though still remain near 2008 levels.

Also no surprise is the fact that more than 87 percent of respondents cited funding and related issues as their number one concern for 2009. One municipal manager from Maryland voiced concern regarding “our customers’ ability to pay for water and sewer services.”

However, by-and-large, those surveyed were also hopeful – and excited – about the opportunity to receive a huge influx of federal funding as part of the economic stimulus package currently being debated in Congress.

In some cases, municipal personnel were not as much concerned about budget shortfalls as how funding was being secured. In Ohio, a respondent pointed out that “lack of dedicated funding” was hurting their sewer/water district. Also, in light of the recession, many cities are restructuring their departments with hiring freezes, reduced budgets and even delayed projects. “Basically, we’re being asked to do more with less,” said a California respondent.

Five-Year Spending for U.S. Sewer/Water Piping Infrastructure
Surveys were distributed through both regular mail and e-mail with a website link to over 8,000 municipal sewer/water management personnel directly involved or responsible for underground piping infrastructure. Responses were categorized by region and city populations to avoid artificially skewing results. The study was conducted in November and December 2008. Cities responding to the survey ranged in size from as small as 267 residents all the way up to the nation’s top four most populous cities: New York, Los Angeles, Chicago and Houston.

Recession impacts

Contrary to what many believe, sewer and water funding is not recession proof – as several municipal managers pointed out in the survey. Recession resistant is a more accurate market description.