April 2010 Vol. 65 No. 4
Newsline
April Newsline: New Orleans reinstates sewer/water program; Keystone Pipeline grabs; raising rates to fund infrastructure and more
New Orleans sewer, water board to reinstate program in wake of Hurricane Katrina
Governor wants piece of Keystone Pipeline pie
Higher water rates could fund infrastructure projects
Whistleblower to sue PVC pipe manufacturer
AEM survey reinforces industry turn around
OSHA proposes recordkeeping change to improve illness data
New Orleans sewer, water board to reinstate program in wake of Hurricane Katrina
The Sewerage & Water Board of New Orleans has agreed to reinstate its comprehensive program – stalled for several years in the aftermath of Hurricane Katrina – to make extensive improvements to reduce or eliminate sewage overflows into the Mississippi River, Lake Pontchartrain and its storm drainage canal system, the Justice Department and U.S. Environmental Protection Agency announced.
According to a Clean Water Act settlement filed in January that modifies a 1998 agreement, the Sewerage & Water Board, which operates the publicly owned treatment works that serves the citizens of New Orleans, has agreed to continue to repair its aging sewage collection system. Prior to 1998, the system had been overwhelmed causing overflows of raw sewage into waterways and streets of New Orleans. Those efforts were put on hold for several years due to Hurricane Katrina in 2005.
As part of its ongoing remediation program, estimated to cost more than $400 million from its inception in 1998, the board has agreed to repair all of its 62 pump stations damaged by the hurricane, as well as any other hurricane damage in the portions of the collection system served by those pump stations. By no later than July 2015, the board will complete additional studies required by EPA and make all necessary repairs and upgrades to its collection system, including measures designed to provide dependable electrical services at its treatment plant in the event of a future catastrophic event.
The board will also design and implement a new preventive maintenance plan to inspect and clean its sewer lines and pump stations to prevent sewage overflows, and will continue efforts under its sewage overflow action plan designed to minimize the impact of such overflows on the environment.
In addition, now that the system serves only about 60 percent of people that it served before Katrina hit, the board has agreed to report each year on population changes and to evaluate any need for increased capacity for its pump stations, force mains and treatment plant.
Governor wants piece of Keystone Pipeline pie
Montana Governor Brian Schweitzer said he wants oil companies in Montana and North Dakota to be able to tap into a proposed pipeline that would run from Alberta to the Gulf Coast.
The proposed Keystone XL Pipeline project is an approximate 1,980-mile, 36-inch crude oil pipeline that would begin at Hardisty, Alberta and extend southeast through Saskatchewan, Montana, South Dakota and Nebraska. It would incorporate a portion of the Keystone Pipeline to be constructed through Kansas to Cushing, OK, before continuing through Oklahoma to a delivery point near existing terminals in Nederland, TX, to serve the Port Arthur, TX, marketplace. Also proposed is an approximate 50-mile pipeline to the Houston marketplace.
The Governor asked the Public Service Commission to investigate whether the statE has authority to force Calgary-based TransCanada to allow an on ramp for the region’s oil near Baker. That would help oil companies in the two states get better prices for their fuel, which is often sold at a discount because of shipping restraints.
Higher water rates could fund infrastructure projects
City council officials in Houston are in talks to look for a way to increase in its water rates to help fund water and sewer projects. The increased rates would prop up the finances of the Combined Utility System fund, which is used to not only rehabilitate water and sewer lines, but also to pay for drainage projects.
Mayor Annise Parker said she would consider a water rate increase to keep pace with related costs.
The increase could come all at once or be spread over several years. Under the former option, one estimate suggested as much as a 14 percent rate hike would be necessary to sustain the system and the infrastructure projects it pays for. That would equate to about a $3-a-month increase for the average residential water user.
Under former Mayor Bill White, the city’s water/sewer system was on the brink of insolvency shortly after he took office in 2004. City Council refinanced its debt and set in motion automated increases based on inflation and, last year, population growth. Those increases no longer are adequate to keep pace with the upkeep of the system and the infrastructure projects the city needs to mitigate flooding, city officials said.
Parker said the decision about rate increases will revolve around how many capital improvement projects City Council members decide the city needs. A council committee and a group of transition advisers separately are working on the question of how to fund drainage and flooding projects.
Whistleblower to sue PVC pipe manufacturer
A three-year old whistleblower suit unsealed in a federal district court in Los Angeles on Feb. 8 claims that J-M Manufacturing, now trading as JM Eagle, and its former parent company, Formosa Plastics Corp. (USA), supplied water and sewer systems with PVC pipes that JM knew were substandard. It asserts that up to 50 percent of the pipe produced between 1997 and 2005 is prone to breakage and leaking at pressure loads below the labeled rating. The pipe is used in water and sewer systems that, for the most part, are owned and operated by municipalities and public water districts.
Nevada, Virginia, Delaware, Tennessee, San Diego, Sacramento, San Jose, the Los Angeles Department of Water and Power and 39 other California municipalities and water districts have joined the whistleblower lawsuit seeking millions of dollars in damages.
The lawsuit alleges J-M deceived its customers by specially producing pipe samples tested by outside certification agencies such as Underwriters Laboratories (UL), International Plumbing and Mechanical Officials and NSF International, while continuing in its day-to-day operations to use a cheaper manufacturing process that produced weaker pipes but enabled the company to increase its profits.
Despite these significant production changes, J-M failed to re-qualify its pipe as industry standards require and instead falsely represented that the pipes were unchanged, according to the lawsuit.
Formosa Plastics required J-M to use its resins and compounds for much of the PVC pipe at issue in this case and actively participated in the fraud, according to the lawsuit.
Localities could save big on infrastructure with competition, better materials
As the infrastructure that delivers water to homes begins to deteriorate, governments at all levels need to take steps to ensure they’re not flushing taxpayer dollars down the drain when replacing the pipes, according to a brief published by the National Taxpayers Union (NTU).
“By opening municipal procurement and ensuring that more competitive bidding is tied to federal funds for underground infrastructure, the U.S. will save hundreds of billions of dollars in the short term,” wrote Bruce Hollands, executive director of the Uni-Bell PVC Pipe Association and the author of the brief. “This would also pave the way to an economy that wastes less energy, utilities that are more efficient, and pipe networks with much longer life cycles.”
NTU Issue Brief #176, The Underground Infrastructure Crisis: Rebuilding Water and Sewer Systems without a Flood of Red Ink, reports:
1. Infrastructure for water, electricity, sewer, and transportation services is deteriorating at a rate that will cause all four to need replacement at the same time. At a minimum, this will cost $6.5T in the next 25 years.
2. Corrosion of pipes costs water and sewer systems $50.7B annually, and 17 percent of all water pumped in the United States is lost to leakage from corroded pipes.
3. Federal policy over the past 50 years has encouraged the use of plastic and PVC piping that reduces corrosion and minimizes transportation, maintenance, and construction costs to municipalities.
4. Pending legislation to address infrastructure renewal does not address corrosion problems or encourage use of more sustainable materials.
The complete NTU Issue Brief is available in PDF.
AEM survey reinforces industry turn around
Construction equipment manufacturers expect overall industry business to turn around slightly in 2010 following double-digit expected year-end 2009 declines in the minus 40 percent range for the United States and minus 30 percent range for Canada and other worldwide sectors, according to the annual “outlook” survey of the Association of Equipment Manufacturers (AEM). Survey respondents then anticipate stronger growth going into 2011, but not enough to erase the severe 2009 business and job losses. Business in 2012 is then expected to level off.
Construction machinery business in the United States was predicted to end 2009 with a 43 percent overall drop and then increase 5 percent in 2010, followed by gains of 15 percent in 2011 and 14 percent in 2012.
For Canada, 2009 business was anticipated to decrease 34 percent overall with a 2010 increase of 7 percent, 14 percent increase in 2011 and 11 percent increase in 2012. Industry business to the rest of the world was expected to close out 2009 with losses of 34 percent, followed by a 2010 gain of 7 percent and growth of 13 percent in 2011 and again in 2012.
AEM President Dennis Slater said: “Global business will be a key to our industry’s turnaround, and we need policies that enhance our competitiveness in world markets. For example, we still have pending free-trade agreements (FTAs) with South Korea, Panama and Colombia. These agreements would help open overseas markets to U.S. exporters and investors.
“In contrast to the U.S., the European Union is joining East Asian and Latin American countries in negotiating dozens of FTAs. Our failure to pursue FTAs could very well cost U.S. manufacturers much needed competitive advantages by keeping the playing field tilted in favor of our competitors.
“Emerging markets in the past have been very positive for construction equipment sales. Markets to look at continue to include China and India. These countries are committed to building up their infrastructure to compete on the world stage. For example, in recent years China has invested 9 percent of its GDP for infrastructure, compared to the U.S. total of 0.93 percent investment of GDP. “
The full survey results are online at www.aem.org in the Industry Trends section.
OSHA proposes recordkeeping change to improve illness data
The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) is proposing to revise its Occupational Injury and Illness Recording and Reporting (recordkeeping) regulation by restoring a column on the OSHA Form 300 to better identify work-related musculoskeletal disorders (MSDs). The rule does not change existing requirements for when and under what circumstances employers must record musculoskeletal disorders on their injury and illness logs.
Many employers are currently required to keep a record of workplace injuries and illnesses, including work-related MSDs, on the OSHA Form 300 (Log of Work-Related Injuries and Illnesses). The proposed rule would require employers to place a check mark in a column for all MSDs they have recorded.
The proposed requirements are identical to those contained in the OSHA recordkeeping regulation that was issued in 2001. Prior to 2001, OSHA’s injury and illness logs contained a column for repetitive trauma disorders that included noise and MSDs. In 2001, OSHA separated noise and MSDs into two separate columns, but the MSD column was deleted in 2003 before the provision became effective. OSHA is now proposing to restore the MSD column to the OSHA Form 300 log.
“Restoring the MSD column will improve the ability of workers and employers to identify and prevent work-related musculoskeletal disorders by providing simple and easily accessible information,” said Assistant Secretary of Labor for OSHA Dr. David Michaels. “It will also improve the accuracy and completeness of national work-related injury and illness data.”
For more information, view OSHA’s proposal at: www.dol.gov/federalregister/msdcolumn.
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