Economic Stimulus Money for Water Projects

Water ProjectsIn the United States, some regions face continual issues in relation to water use and management. Water related problems are compounded as a result of droughts in places like California while shortfalls in budgetary allocations limit what the State Government can do to alleviate these problems.

Federal Aid in the form of Economic Stimulus Money for Water Projects

For areas facing long term water challenges, relief under the American Recovery and Reinvestment Act of 2009 comes in the form of federal economic stimulus money being provided for projects involving the supply of clean and reliable drinking water and improving of waste water treatment Procurement bids plants around the nation. The US government’s aim in providing economic stimulus money is to fund clean water projects while also creating new jobs that will help revive the economy.

Water Projects Eligible for Economic Stimulus Money

Water Pipeline tender projects to upgrade or expand sewer infrastructure and waste water treatment plants, restoring the existing waterways to improve water quality and projects that use innovative methods to recycle and utilize water, all receive economic stimulus money.

Small communities often face problems with water systems in the form of small waste water treatment plants that may be unable to provide the required services effectively. Federal funding or economic stimulus money is also made available to such communities that face water related issues.

Rural water projects also get federal funding so that rural communities have access to quality water supply systems and waste water treatment plants.

Economic stimulus money for water projects has assisted in setting up wastewater treatment systems, water recycling facilities, storm water treatment, sewers and sewer interceptors and given a boost to watershed and estuary protection efforts.

Screening Process for Economic Stimulus Money

To be eligible for economic stimulus money the applicant must undertake a financial credit review. Water Construction projects desirous of federal funding must abide by Public Contracting Code. The recipients of economic stimulus money must possess the technical capability to complete the project within the stipulated time. In addition, they must also have the financial as well as managerial experience to make wise decisions to ensure financial viability of the project.

The applications for economic stimulus money go through a screening process wherein the Water Board’s engineering staff evaluates the project plans. Project specifications and designs are reviewed to ensure that the design is able to achieve the project goal. Throughout the construction phase, the recipients of funding must submit progress reports each quarter.

Reimbursement of costs and requests for payment must be supported by invoices that are verified by the project manager in order to ensure that the costs claimed are indeed meant for the wastewater treatment project approved for economic stimulus money. Also, spot inspections are carried out by the Board’s officials to verify the progress of construction.

Going forward

President Obama’s economic stimulus package has given a major boost to Wastewater projects. Although a lot more funding is required, it is a step in the right direction to safeguard and improve the country’s water infrastructure.

Water Utilities-Why Revenues Decrease while Costs Increase

Wastewater treatmentThe surprising truth about utility services is that they are not immune to economic downturns. Governments may do their best at limiting cost increases in providing utilities but the bottom line is that revenues have been on the decline.

A number of reasons have caused this situation, the main one being a fall in the demand for water and Wastewater treatment.

Usage of a water system creates a demand for the water itself as well as a demand for the Wastewater Treatment Bids of wastewater after it is utilized. In the years prior to the recession, there was a huge demand for water from heavy industries sector as well as the domestic sector and water utilities responded by setting up large water distribution facilities and wastewater treatment plants.

The unexpected fall in demand led huge processing capacities to remain unutilized or underutilized. The maintenance costs however did not come down. On the one hand, while the revenues earned by water utilities decreased, the costs of maintenance remained fixed, eating into their profit margins.

Closure of Heavy Industries Impacts Demand for Water

Food processing industries, metal processing plants, assembly units as well as other manufacturing units are the biggest consumers of water systems. Water is also the main component for water jet cutting, washing, heating and cooling processes in most of these factories.

With several key industries facing economic downturns, some have scaled down production while some have temporarily or permanently shut shop. In both cases, end result was a drop in demand for water systems. Even though the demand reduced, the state-of-the-art water treatment and distribution facilities had to be maintained at fixed operating costs while the Water treatment contracts revenues decreased.

Impact of Water Conservation in the Domestic Sector

Loss of jobs and reduced income sources forced the domestic water consumer to make all efforts to keep their water bills down. People cut down on water usage by avoiding watering lawns, gardens and in any other way they could. Cars were washed once in two weeks instead of every third day. All this led to a reduced demand and consequently less income for Water utilities bids, their operating costs continued to remain fixed, decreasing their revenues.

Building and Construction Industry

The construction and real estate boom before the recession saw an increase in demand for water in the form of new water and sewer lines thus increasing Water utility bids revenues. When the recession set in, new construction projects came to a standstill drying up the income for water companies. Again, the cost of running the facilities remained the same while the income declined, creating a situation of decreasing revenues and increasing costs for the water utility companies.

Planning for the Future

In these difficult times, water utilities made all efforts to cut down their costs; lay offs were common as a cost cutting measure. Most of the water utility companies tried all means to reduce their operating costs. Clearly, these measures did little to help stall the problem – the recession taking its toll in a big way.

Very soon, the economy may revive resolving the issue of decreasing revenues and increasing costs for water utilities. However, in an attempt to secure the future, water utility companies must find the means to manage their business in a better way by identifying weak spots and plugging them in an effort balance their finances. Although this may not be a foolproof method to take care of the situation, it will certainly help them weather any future storms on the economic scenario.