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Blue-Ribbon Panel Reveals Shaky State of NJ's Water, Gas, Power, and Transportation Infrastructures

Tom Johnson | March 4, 2013

For Facing Our Future, billions needed to upgrade infrastructure will climb even higher in wake of Hurricane Sandy.

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To understand how badly broken New Jersey’s infrastructure is, just take a look at its system for delivering drinking water to its eight million residents.

Between 20 percent and 22 percent of the state's treated drinking water is lost long before it's delivered to households and businesses, according to a draft study by Facing Our Future, an independent, bipartisan group of former cabinet members and senior government executives.

The report projects that $7.9 billion needs to be invested in the New Jersey's water infrastructure over the next five years, according to Michael Catania, a member of the organization and a former columnist for NJ Spotlight. Add in wastewater treatment facilities, and the number rises to $36.6 billion.

“We’re just not doing the job right now,’’ said Catania, president of Conservation Resources Inc., and a former deputy commissioner of the state Department of Environmental Protection.

The report on the state’s aging infrastructure is expected to be released by the end of the month. The group hopes it will spur more vigorous public debate on how to address New Jersey’s ever-expanding needs to modernize its infrastructure.

“It’s meant to be a wake-up call,’’ said Catania, speaking at the annual Redevelopment Forum held by New Jersey Future at the Hyatt Regency in New Brunswick on Friday.

“It’s time to take the reins and make the investment in the infrastructure before it is too late,’’ Catania said.

An earlier study by the State Budget Crisis Task Force, another blue-ribbon panel comprising former government executives from both the state and the federal level, projected that New Jersey needs to spend $133 billion over the next ten years to fix its transportation system, wastewater treatment plants, and drinking water facilities.

That report, released this past December, was completed largely before Hurricane Sandy struck New Jersey, damaging some major thoroughfares and a few of the biggest wastewater treatment plants.

Ingrid Reed, the former director of the NJ Project at the Eagleton Institute of Politics at Rutgers University, noted this is not a new problem. “This existed before Sandy,’’ said Reed, who serves as chairwoman of the board of directors for NJ Spotlight.

“For decades, New Jersey, like the rest of the country, has underinvested in its infrastructure,’’ said Peter Reinhart, the chair of New Jersey Future and a moderator at the conference. Reinhart also is a member of NJ Spotlight board.

Putting money into its infrastructure is crucial to the state’s economic success, according to several speakers at the conference, which also focused on climate change and the need to rebuild New Jersey without leaving lower-income communities behind.

“We know we can’t tax our way out of it and we can’t cut our way out of it,’’ Reed told the more than 500 people attending the conference in a session focused on investing in next-generation infrastructure.

Those costs are already beginning to be felt by ratepayers. Three of the state’s water utilities won approval from the New Jersey Board of Public Utilities to add modest surcharges on customers’ bills, ranging from $1.77 per month to $2.99 a month to speed up replacement of aging water mains and other equipment.

Hurricane Sandy also is likely to boost customers’ bills. Public Service Electric & Gas, the state’s largest gas and electric utility, last month proposed spending up to $3.9 billion over the next decade to deal with resiliency issues that emerged in the wake of superstorm Sandy, which left millions of customers without power for as long as a week.

The utility said the investments will not increase customers’ bills, largely because a few surcharges stemming from the deregulation of the energy sector will disappear in the next several years. The historically low price of natural gas prices will also offset increases to customer's bills.

Former Gov. Jim Florio, however, said investing in infrastructure is an issue that the federal government will inevitably have to face.

Florio, moderating a session on how sea levels in New Jersey could rise as much as three feet by the end of the century because of global climate change, said it is wrong to think the system now in place in Washington can deal with these problems.

“At some point, someone has to deal with the folly that is the system we have now and its inability to deal with the needs of the nation,’’ Florio said. “We really don’t have a spending problem; we have a revenue problem.’’

That issue arose at a breakfast keynote by Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development. The failure of Congress and the administration to reach an agreement on sequestration means that $800 million in funds for the agency will be cut, affecting 10,000 families and businesses trying to rebuild after Sandy, Donovan said.

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