Local Government Spending on Public Water and Wastewater, Constant Dollars, (2008 Dollars YEAR $ Bill Total Water and Wastewater Spending O&M Capital Spending

Year Loc Gov Water & Wastewater Spending ($ bill) GDP ($ bill) , , , ,265

Comparison of Local Government Investment and Federal Program Assistance “Face-Value” Investment Source Percent of Non-Defense GDP Local Government (average)0.65 EPA-SRF (est.– 2006, favorable interest rate on loans) EPA-SRF (cumulative-revolving – loans)0.002 EPA (Congressional Earmarks – one year est. - grants)0.003 Department of the Treasury (Muni Bonds )0.02 HUD (one year est. from spending)0.003 USDA (one year est. from spending)0.003 DOC-EDA (one year est. from spending)0.0009

Future Spending to Year Spending Scenario High Estimate 7.5% ($ Trillion) Mid-Range Estimate 5.22% ($ Trillion) Low Estimate 2.66% ($ Trillion) Total Local Government Spending Additional Needs Gap $25 billion/Yr Needs Gap as % of Total 10.3 – – – 20.0 Nominal Annual Spending in

Anticipated- not yet Quantified Changing Human Settlement Patterns – population growth – urbanization – increased reliance on public water/wastewater Above ground assets approaching end of useful life More advanced levels of energy intensive treatment technology – unfunded federal mandates: consumer personal care and pharmaceutical product discharges – Reuse of wastewater effluent – Recovery of brackish water from sea and aquifers Climate Change impacts: floods, droughts, increased coastal high hazards

CBO suggests that future costs can be funded from many sources and subsidies “…are not necessarily a federal responsibility.” (Congressional Budget Office 2002).

GAO “…EPA provides a significant amount of financial assistance for these facilities. Other federal agencies, as well as states, also provide assistance.” (General Accounting Office 2002, p. 2)

CBO On federal subsidies “…run the risk of undermining the incentives that managers and consumers have to make cost-effective decisions, thereby retarding beneficial change in the water industry and raising total costs to the nation as a whole.” (CBO 2002, Summary)

CBO Before asking Congress for more subsidies pursue these best practices »Demand Management »Labor Productivity »Consolidate Systems »Asset Management Planning »Innovative Construction Contracting