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Posted 5/1/06

New report assesses wastewater systems damage and reconstruction costs in Gulf Coast

A new report on the damage to wastewater systems, in the wake of last year's Hurricane Katrina, estimates the repair costs at $1.4 billion.

While these services are critical to public health and the overall rebuilding process, the affected utilities are struggling to find the money needed to repair and rebuild these systems, as well as to replace lost revenues due to a reduction in population, according to the report published by the Water Environment Federation (WEF).

Assessment of Reconstruction Costs and Debt Management for Wastewater Utilities Affected by Hurricane Katrina, found that most of the damage to wastewater utilities was in surge zones. The report, which focused on Louisiana, Mississippi, and Alabama, estimated that 445,000 people lost their homes due to a 15- to 25-foot storm surge that hit the three states. In addition to the devastating personal losses, displaced populations will result in reduced revenues for wastewater utilities in the surge zone. Although working to meet immediate needs, these utilities could face a prolonged period of insufficient funding to maintain essential public health infrastructure and meet long-term debt obligations.

Federal government and state agencies previously lacked comprehensive data on the condition of these systems as well as the utilities’ financial position. Presented to Congress, the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Agriculture (USDA), the non-commissioned report was published by the not-for-profit Water Environment Federation (WEF), in collaboration with global engineering, consulting and construction company Black & Veatch, several municipal water agencies, and volunteers from among WEF’s 36,000 members.

"The study originated from a general lack of attention paid to the wastewater industry in response to and recovery from a major disaster," said Jim Clark, vice president of Black & Veatch and a principal investigator for the study. "Although these services are critical for public health and the environment they are often overlooked. Our goal was to produce a high-level cost assessment that can be used as a basis for assessing the need for reconstruction funding and financial support."

Databases provided by EPA and states were used in the study and revealed that 118 wastewater utilities serving approximately 1.8 million people were affected by Hurricane Katrina. A sample group of 25 utilities was assessed for infrastructure damage — field investigators visited 19 facilities and telephone surveyors polled an additional six utilities. Results were categorized by damage zone—surge, flood, or winds greater than 100 miles per hour — and treatment plant type and used to develop average costs, which were applied to each of the 118 utilities based on damage zone location.

The final report found that the total cost assessment to repair and rebuild wastewater collection and treatment plant infrastructure was about $1.2 billion. In addition, an estimated $163 million will be needed by the wastewater utilities to maintain financial solvency and critical infrastructure because of the impact on revenue of the reduced population in their service areas. The study authors used average per-person revenue and expense data to estimate the financial effect on the utilities.

Faced with these issues, the report estimates a total of about $1.4 billion is required to address the needs of impacted wastewater utilities. Also included are recommendations for federal and state agencies to consider in responding to the immediate and long-term financial needs of these utilities. "This report makes several rec


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