The past year has forced local government utilities to make difficult decisions about how to maintain operations while providing essential services during an infectious disease pandemic, as discussed in several of our past blog posts (here, here, and here).
Financial viability is a cornerstone of a utility’s ability to weather a proverbial storm that disrupts revenue flows. A viable system is one that functions as a long-term, self-sufficient business enterprise while providing reliable water services. The EFC has been on the look-out for stories of utilities and municipalities that are making steps towards financial viability, even in the midst of challenges like COVID-19.
The town of Ahoskie, located in rural Hertford County, has been implementing financial best practices over the past few years to decrease expenses and pay off debt, which set them up to survive a financially straining event like a lockdown. Below is a part of their story, here is a video that highlights the work they’ve done, and here is a more in-depth report. More resources regarding evaluating costs can be found at this webpage.
According to data collected and published by the Congressional Budget Office (CBO), federal, state and local governments in the United States spent more than $2.2 trillion in the last 59 years on operations, maintenance and capital infrastructure of water and wastewater utilities. That equates to more than $4,131,000,000,000 in 2014 dollars, adjusting for inflation of infrastructure-specific costs. Following our earlier blog post demonstrating that federal spending on water and wastewater utilities decreased since the 1980s, we analyzed the data and identified 4 more trends in how government spending on utilities changed between 1956 and 2014.
As the green infrastructure (GI) approach to water management gains momentum, the budget process needs to adapt to some of the characteristics that make green distinct from the more traditional gray infrastructure approach. As communities are embarking on GI, shortcomings in the budgeting process can falsely create a bad first impression. When inaugural GI projects are grossly over budget for their installation, or need more frequent maintenance than planned, future GI projects may be blocked before the current project’s vegetation can become established enough to produce the significant benefits for which it was designed. However, considering and planning for certain key attributes of GI can fend off this negative cycle. Continue reading