March 19, 2009

Stimulus Package – Its Effect On You And Your Utility

by Bob Murphy

The Check Is In The Mail!

Water and wastewater utilities have always faced difficulty securing financing for large multi-year, capital-intensive infrastructure projects. The current economic crisis has made access to funding for necessary upgrades and repairs almost impossible.

Water and wastewater infrastructure investment means jobs. It also ensures that Americans will have access to clean water. The National Association of Water Companies recently issued a white paper outlining several recommendations, including:

  • Investment Tax Credits: A 10% investment tax credit on all investments in water and wastewater infrastructure for the next three years.
  • Public Utility Dividend Reinvestment: A five-year deferral of tax on dividends for all public utility dividends that are reinvested in infrastructure replacement.
  • Tax Exempt Financing: Lifting the cap on Private Activity Bonds for all water and wastewater investments.
  • Accelerated Depreciation/Extend Elective Expensing: A 50% increase, or more, in depreciation rates for infrastructure replaced over the next three years.
  • State Revolving Loan Funding: An increase funding of these programs and insure access to all providers of water and wastewater services.

Individually, any of these proposals will infuse needed capital into water and wastewater systems. Taken together, they would be a large step towards meeting the trillion dollar investment the U.S. EPA estimates is needed over the next 20 years to assure build out and maintenance of critical water infrastructures.

Utilities must have their projects “Shovel ready” in order to capitalize on the available monies. Systems need to be surveyed, needs identified, new projects and maintenance retrofit must be defined.

Stay tuned to this blog to see ways that Sherwin-Williams can help you and your utility maximize dollars spent in protecting these valuable assets.

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