Photo from the Baltimore Sun taken by Jed Kirschbaum.This happens every so often in older homes, cars, cities. Stuff breaks. And, as was the case with the recent water main break that still has Lombard Street closed, people sometimes have a good idea where repairs should happen before it becomes an emergency.
Unfortunately, it can be difficult to come up with the money and initiate a majorly disruptive infrastructure improvement project (with all the attendant traffic tie ups, pedestrian inconvenience and noise associated with it), especially if everything looks fine on the surface.
This is the challenge local governments face constantly. Money is short, needed repairs get put on hold. Communities want infrastructure improvements, but bristle at the cost in terms of tax or fee increases. And nobody wants to sit in traffic while the construction happens.
But the cost of doing nothing is much greater, as the Lombard break illustrates. Unfortunately, whether preempitvely for upgrades or post break for emergency repairs, the bulk of the cost for infrastructure improvements is shouldered by local taxpayers.
In 2007, the U.S. Conference of Mayors published a report that found 95% of the cost of water and sewer infrastructure development and operations is paid by local jurisdictions while only 5% is covered by state or federal monies. It also found that "state and federal contributions are flat and declining over time, even though federal mandates continue to grow."
Part of this makes sense... that a local municipality should pay for its own infrastructure. But, here's where it gets interesting. The authors of the report concluded that, "the direct and indirect benefits of increased investment in public water and sewer are significant. The findings support the notion that increased spending could stimulate the sluggish economy while at the same time providing clean water and sewer services to protect public health."
They argue that infrastructure development has a trickle-up effect on the regional and national economies so it's in the best interests of state and federal governments to cough up more assistance for these local projects. Here are their findings to back this up:
"One dollar of water and sewer infrastructure investment increases private output (Gross Domestic Product, GDP) in the long-term by $6.35;
"Each additional dollar of revenue to local government from providing water and sewer system operation and maintenance increases revenue (economic output) that occurs in all idustries by $2.62 in that year;
"Adding one new job in local water and sewer creates 3.68 jobs in the national economy to support that one job."
-Mike Evitts
