Page 91 - Urban water supply handbook

IMPROVING URBAN WATER INFRASTRUCTURE THROUGH PUBLIC-PRIVATE PARTNERSHIPS

3.10 HISTORY, PLANNING, OUTSOURCING

TABLE 3.3 Estimated Cost Savings from Water and Wastewater
Public-Private Partnerships
Contract term, Estimated
Municipality System type years savings, %

Atlanta, Ga. Water 20 45
Franklin, Ohio BOT wastewater 20 23
Franklin, Ohio BOT water 20 30
Milwaukee, Wis. Wastewater 10 30
New Haven, Conn. Wastewater 15 30
Newport, R.I. Wastewater 20 24
Plymouth, Mass. DBO wastewater 20 19.7
Seattle, Wash. DBO water 25 40
Tampa, Fla. DBO water 15 5 21
Tampa, Fla. DBOOT desalination 30 50

BOT build, operate, transfer; DBOOT design, build, own, operate, transfer.
Source: Public Works Financing, January 2001.

Cities facing financial limitations and citizen opposition to tax increases will
find it difficult to finance water and wastewater improvements internally. Public-
private partnerships, offering significant cost savings, operational improvements,
and innovative financing schemes, will be an increasingly attractive option for
urban officials.

3.4.3 Unfunded Mandates

While reducing its contributions to local water systems over the past 30 years, the
federal government imposes strict water quality and effluent standards under the
Clean Water Act and Safe Drinking Water Act. Unfunded mandates force munic-
ipal systems to meet federal regulations through local sources of revenues or state
revolving loan funds. The EPA continues to toughen monitoring requirements,
develop stricter contaminant removal standards, and more vigorously pursue com-
pliance, resulting in higher costs for municipalities.
For example, AWWA estimates that the cost to local governments of meeting
toughened arsenic standards is approximately $14 billion in capital investments
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nationwide and $1.5 billion in additional annual operating costs. Nearly all the
communities affected serve less than 10,000 people, putting further strain on lim-
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ited local budgets. Enforcement of a lower standard on radium levels in drinking
water could impact more than 100 communities in Illinois.

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