Underground Infrastructure - February 2023 - 15

Forecast & Market Analysis
greater confi dence in spending for 2023,
compared with recent years. Most survey
respondents (75 percent) will be seeking
a piece of the abundant federal funding
pie. Plus, consulting engineering companies
have increased their engagement
in aiding cities of all sizes to fi nd funding
options, whether it be federal grants or
matching funds, SRFs or state options.
During the pandemic, two major funding
packages increased the U.S. fi nancial
defi cit by trillions of dollars. With the
infrastructure act and spending programs
continuing to run up the national debt, infl
ation rates have been driven to 40-year
highs. Th e federal dollars are not stretching
as far as hoped and lessening the desired
eff ect for infrastructure projects.
As of this writing, infl ation has started
to come down from its June high of 9.06
percent to 6.45 percent in December
2022. As our FMI friends explain " ... infl
ation above 7.0 percent is signifi cantly
greater than the target of stable monetary
policy and a 2.0-percent infl ation rate.
" Th e consumer felt the impact of
infl ation over the last 18 months, but if
infl ation holds at current levels, two-year
price increases would be back above 14
percent. Th ese are price increases reminiscent
of the late '70s, early '80s. "
More
Even with all the spending of 2002 and
projected through 2026, most city personnel
responding to the survey still admit it's
not nearly enough to satisfy their needs.
" We're so far behind, it's going to take
decades for us to dig ourselves out of the
hole we're in, " said a municipal manager
for a major city in the Northeast. " We're
making progress right now, but what
happens when the federal dollars run
out? Will our city management do what
it takes then to keep our spending levels
where they need to be? "
City personnel were asked to, assuming
a perfect world, put a price tag on their
near-term funding needs to address all
their system issues. Respondents believe
they would need $107 billion for sewer,
$82 billion for water and $23 billion for
stormwater. When asked the same question,
but for a fi ve- to 10-year period, the
amounts increased to $318 billion for
sewer, $122 billion for water needs and
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Respondents report that their city
governments are still reluctant to raise
user fees, especially with the cloud of a
potential economic recession fl oating
overhead. But clearly, survey respondents
said, it is still an active option on the table.
" We increased rates in 2020, skipped
'21 and '22 due to the pandemic, but
we'll probably have to boost sewer and
water rates in 2023, " said a Southwest respondent.
" We think we'll receive some
government money in 2023 but it won't
be nearly enough to catch up. "
Th at sentiment was repeated frequently
by survey participants. " With
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UndergroundInfrastructure.com | FEBRUARY 2023 15
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Underground Infrastructure - February 2023

Table of Contents for the Digital Edition of Underground Infrastructure - February 2023
