Underground Construction - February 2018 - 2

EDITOR'S LOG
Robert Carpenter | Editor-in-Chief

The Infrastructure Marshall Plan

Beginning on page 12, this issue
includes our highly anticipated
Municipal Sewer and Water Survey.
The exclusive survey, conducted
last fall by Underground Construction
magazine, provides an amazing
window into the mindset and funding plans of U.S. sewer/water infrastructure personnel.
What stood out head and shoulders above all other issues was the
desperate plea for immediate investment in the sewer, water and
stormwater markets. While not
necessarily surprising, after a weaker-than-expected 2017 spending
year, city personnel are especially
concerned about their neglected
piping resources.
To some degree, the boondoggle of Flint, MI, has popped the
entire underground sewer/water
infrastructure condition onto the
national stage. But is it enough
to push through proper funding
plans? Or will the national consciousness fade, letting Congress
and state/local officials move on to
their next fight that is most likely
more visible and potentially politically significant?
Following World War II, most of
Europe was in tatters. While the human price for Adolph Hitler's insanity brought the world to tears, the
cities were reduced to rubble and
the countryside was pot marked
with shell holes and destruction.
As the countries of Western
Europe stumbled along the road
to rebuilding, in 1948 the United
States stepped up with the Marshall
Plan (nicknamed for its architect,
Secretary of State George Marshall). It amounted to an economic
development and investment plan
for Western Europe (Eastern Bloc
countries, cowering under Soviet
Union pressure, declined to participate). Over five years, the modernday equivalent of $140 billion
helped Western Europe acceler-

FEBRUARY 2018 | UConOnline.com

ate its recovery to heights greater
than pre-war levels. In short, unprecedented economic prosperity
returned to Western Europe. There
were some strings attached, but
largely practical.
Back to the present, Congress
recently passed a revised tax plan
that restructures the tax code and
includes favorable business tax
reforms. Part of that includes a revision of the repatriation tax rates,
making it at last economically feasible to bring home foreign money
stashed in tax havens around the
world by many of America's largest
companies. The treasure trove of
corporate profits, estimated at $2.6
trillion, sat in foreign bank accounts
- just waiting for a tax break before
the money could be moved home.
Apple's CEO Tim Cook made the
incredible commitment to invest
$350 billion over five years into the
United States economy. That will
bring home about $252 billion from
its overseas accounts. The investment includes paying an estimated $38 billion in repatriation taxes
over five years.
Washington bureaucrats may
already have a long list of possibilities for that tax money, and who
knows how many other corporations will follow Apple's lead. But
here's a novel thought. How about
dedicating those funds directly to
infrastructure?
The funds are essentially "found
money." While that amount of
money would by no means solve
all the country's infrastructure
problems, it could provide a critical
jump-start. Assuming the underground infrastructure receives its
fair share, think of what municipalities can do with an extra $8 - $10
billion per year for five years?
That's only the beginning. A
sustained investment would still
be needed. Congress would have
five years to negotiate some kind of

reasonable annual investment for
infrastructure.
That high level of investment
would right many tilting - even
sinking - municipal ships. The catch
is there would be reasonable conditions in accepting the repatriation tax money. Primarily, I would
suggest cities can no longer allow
deficit spending all just to keep user
fees low. Cities must maintain user
fee rates in line with true operational costs and inflation. For many
cities, that would mean major fee
increases spread over five years, but
the long-term results would prevent falling back in poor habits and
making beggars out of cities' sewer
and water departments.
As I've advocated before, I would
also suggest an immediate tax on
bottled water. By 2020, the global
bottled water industry is projected
to reach $280 billion in sales, with
the United States comprising the
largest portion of that market. That
would be one way to further generate money both now and after repatriation dollars are spent..
Obviously, I'm not an economist nor, thankfully, professional
politician. I suspect there are many
flaws in my logic. But let's at least
get the conversation started. We
live in an increasingly complicated
society. What used to be routine
infrastructure issues have now
fallen into political conundrums.
Continued investment must be
established for America to have a
chance at reinventing maintenance
and funding protocols that would
lead to a healthy infrastructure and
a healthy country.
Call it a modern-day Marshal
Plan, designed to breathe life back
into the underground infrastructure.

CMY

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Underground Construction - February 2018

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