We have recently seen a national call to action to invest in our nation’s infrastructure. While financial devastation of COVID-19 has laid bare long-standing and dangerous deficiencies in our utility infrastructure, billions in lost revenue for local governments is handicapping the ability to maintain services, let alone make the massive infrastructure improvements that are needed.
Cities need strong investments like President Joe Biden’s American Jobs plan. This $2 trillion infrastructure package focuses on bolstering the post-pandemic American economy and will put people back to work and fix our utility infrastructure for the next generation of Americans.
As a nation, we are not saving dollars or lives by shortchanging our infrastructure and that is particularly true of our public utilities that provide essential services to residents. A 2016 Tufts University study estimated that just three waterborne pathogens that flourish in old pipes send nearly 80,000 elderly Americans to the hospital each year, at a cost of $2 billion — much of which is paid for by Medicare. Further, a 2008 Kansas State University study estimated that freshwater contamination costs the U.S. $5.12 billion in 2020 dollars.
Many of our cities’ public water pipes were installed in the mid-20th century with an estimated lifespan of 75 to 100 years. We are rapidly approaching those expiration dates with little progress to show. A 2017 assessment by the American Society of Civil Engineers determined that it would take an estimated 200 years to update our water system since utilities were “averaging a pipe replacement of 0.5% per year.” The American Water Works Association also estimates that more than 6 million existing pipes are lead service lines that connect municipal water supplies to homes. To immediately remediate this issue in Newark, we have nearly finished replacing all of our city’s lead service lines, which was not an easy or inexpensive endeavor.
Our city has been fortunate for the collaboration and smart, innovative funding and investment in partnership with the State of New Jersey and the County of Essex, who have made it financially possible to commit to removing every lead service line in the city as well as in some of the surrounding municipalities we service. Through the cooperation of our residents, even through the pandemic, we are finalizing a project we expected to be complete in eight years, in less than 30 months. However, many cities are not as well positioned and do not have access to the resources required to fix their infrastructure, especially now.
The economic impacts of COVID-19 have disrupted the normal flow of revenue to public utilities from every direction. Many individual households are unable to pay their bills due to unemployment. Many cities, including Newark, looking to protect residents from additional financial hardship, have introduced shut-off moratoriums for customers unable to pay due to job loss. Further, with many factories and office buildings closed, utilities are not able to rely on revenue from their largest and usually most consistent customers. The National Association of Clean Water Agencies (NACWA) estimated that clean water utilities could potentially experience $12.5 billion in losses due to COVID-19.
These challenges are making it even harder for utilities to maintain and improve their infrastructure. Even before the pandemic, public water systems across the United States faced a $30 billion revenue deficit and the cost is still mounting.
Biden’s plan would address both long- and short-term funding challenges. The funding for lead service-line replacement projects for example would enable cities across the U.S. to remove all of their lead pipes once and for all — just like Newark. His plan would further eliminate all lead pipes and service lines in our drinking-water systems, improving the health of our country’s children and communities of color and positively impacting environmental justice. This is just one of the ways this investment would allow utilities to resume larger capital improvements, which have been delayed by deficits and an absence of long-promised federal funds.
In addition to the infrastructural benefits, Biden’s plan would functionally begin a national public works program. Cities and towns in every corner of the country would contract many of the unemployed Americans to work on wholesale water and other infrastructure upgrades. Newark’s lead service-line replacement program alone has created opportunities for residents to secure well-paying jobs. Next to a guaranteed basic income, a national public works program is the best option to provide financial security to millions of households.
Infrastructure, but especially public utilities, is the unseen backbone of daily life and it is under extreme duress. Addressing this issue is not only necessary to maintain the health and safety of our people and our economy, but also an opportunity to meet the financial needs of our ailing nation while securing quality infrastructure and equitable justice for the next generation. If not now, when?