A safe, reliable drinking water supply is the lifeblood of any community, yet most people do not recognize its immense value, according to a new study from the Denver-based American Water Works Association (AWWA). That fact makes setting responsible rates an ongoing struggle for water utilities, which depend primarily on customer support to maintain their vast, critical infrastructures.

“For too long, the value of water service has been out of the public consciousness,” says Jack Hoffbuhr, executive director of AWWA, the world's largest association of water professionals. “We've tried to maintain systems on fewer and fewer dollars, while more visible projects receive funding and attention. That practice has to end if we are going to prevent today's concerns from becoming tomorrow's crisis.”

The April 2004 report, “Avoiding Rate Shock: Making the Case for Water Rates,” guides utilities on communicating current and future needs to customers and other key stakeholders. Sponsored by AWWA's Water Utility Council, the report contains examples of some utilities' experiences with rate increases and offers insights into smart rate management. It also shows that utilities with consistent communication programs build the credibility necessary to support rate increases, and that a utility's billing practices and rate structure options can affect customer reactions and acceptance of rate increases.

The need to evaluate rate structures is becoming more acute in many communities, because much of the drinking water infrastructure in the United States will need to be replaced in the next three decades. A large portion of water pipes were installed during the late 1800s, the 1920s and the 1950s. All of those pipes are likely to wear out around the same time. The oldest cast iron pipes, laid in the late 1800s, typically must be replaced after 120 years. Pipes laid in the 1920s must be replaced after 100 years. And pipes from the post-World War II boom must be replaced after 75 years. As time passed and technology improved, the cast iron pipes could be made with thinner walls, which ultimately resulted in a shorter life.

That means three eras of pipes are running out of time. The cost estimates for replacing them range from $280 billion to $400 billion.

AWWA's 2001 study, “Dawn of the Replacement Era: Reinvesting in Drinking Water Infrastructure,” reported that the nation's water system has expanded dramatically in the past 70 years, but that there are fewer people per capita to pay for each mile of pipe. Utilities also face the new costs of increasing water regulations, anti-terrorism security measures and infrastructure expansions into new developments. Given the federal budget deficit, no funding is in the pipeline.

According to the AWWA report, consumers have grown accustomed to low rates that do not even pay for necessary repairs, much less the dramatic replacement costs in the near future. Elected leaders are often hesitant to support water-rate increases for fear of backlash from their constituents.

“There are more glamorous projects than replacing water mains, but you'd be hard-pressed to find more important ones,” Hoffbuhr says. “We must begin to pay for these critical improvements today. The best way to avoid ‘rate shock’ in the future is to recognize and begin to address these needs in the present.”

Greg Kail is a Denver-based freelance writer.