How diet and exercise can help curb those infrastructure spending cravings

By Dan McConville

It is common knowledge that diet and exercise are the keys to maintaining a healthy personal lifestyle, and those same principles can help local governments maintain a healthy bank account. For years, American cities and counties spent billions on planning, designing and building infrastructure to address growth, regulatory requirements and maintenance issues. But as the nation fell into a recession, cities and counties across the country are finding healthier approaches to address long-term needs.

Exercise more

In order to achieve better infrastructure health, leaders need to exercise their current assets to become more fit and efficient. This requires a good asset management plan based on addressing your system as a whole. If we look at water and wastewater systems, many leaders ask the utility departments to increase the efficiency of the treatment plants. But it is not enough to focus on making the treatment plant better. This is like going on an exercise program that only focuses on your arms. You need to take a fresh look at the whole system.

One mid-sized East Coast city is taking a new approach to asset management by developing implementable plans for each asset base to show a higher return on investment that ultimately benefits the whole system. Similar to an exercise program, the city is focusing on different aspects of their utility system in order to strengthen each asset base and, as a result, strengthen the whole system. For example, traditionally leaders stretch their water meters to their full life potential, believing they are saving money on replacement costs; however, over time the meters begin to provide lower usage readings leading to a lower revenue stream. City leaders implemented an asset management program to understand the meter readings and recalibrate the meters to avoid losing revenue. The city kept maintenance costs low by stretching the most out of their assets while increasing revenue by making the assets work harder.

Making better choices and eating less

So, once we have a clear exercise plan through better operations, then we have to look at how we can reduce calories by making better choices and eating less. Many of the best leaders across the country are looking to spend more effectively by wringing maximum benefit out of every dollar spent. Using an integrated planning framework (IPF) approach is one way to make sure you are making good choices. The approach is one that can be applied across a range of planning activities and ultimately aims to enhance the environmental, social and financial benefits for communities.

In 2011, one large Midwestern city pioneered the use of IPF to renegotiate a growing consent decree program totaling more than $1.8 billion. Using an IPF approach to review different system impacts and benefits, the city became the first in the U.S. to successfully modify an agreement to increase the environmental benefits of its long-term control plan for less money – ultimately saving $740 million. Following reviews of the existing long-term control plan and evaluating other infrastructure options, the city incorporated various green-for-gray infrastructure solutions, such as rain gardens and wetlands. It is well-known that green solutions provide greater environmental benefits, but by reducing the overall flow of water entering the sewer system, the city reduced the need for new gray infrastructure and ultimately lowered costs and reduced the impact to the community.

Another objective is to eat more slowly and take in fewer immediate calories. An IPF approach allows leaders to stretch spending out over a longer period of time. When IPF is done well, it lowers the costs and allows them to be structured over longer periods of time.

Recently, a large East Coast city accomplished this goal using the formal IPF process and renegotiating its $1 billion consent decree. The IPF process allowed the city to reprioritize needs and balance infrastructure investments across all systems – water, wastewater and stormwater. Through the IPF process, the city identified the immediate investment needs to address regulatory compliance issues and successfully tabled other projects until later in the schedule, ultimately reducing rate impacts for citizens. By elongating the schedule, the city could defer between $200 million and $300 million of compliance investments over the next seven years.

Conclusion

By exercising more, making better choices and eating less, leaders can help American cities and counties become healthier. Combining efficient asset management planning with the benefits of IPF sets American cities and counties on a successful course to addressing capital infrastructure needs while focusing on desired outcomes.

Dan McConville is president of business solutions for MWH Global, a strategic consulting, technical engineering and construction services firm leading the wet infrastructure sector. He joined MWH in 1994 and has served in a variety of leadership and client services roles.

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