May 20, 2012
By David Riley
ASHLAND —Massachusetts must address an estimated $21.4 billion gap over the next 20 years in funding needed to upgrade aging water and sewer systems that are often out of sight, out of mind for the public, said a recent report by a legislative commission.
The state should set aside $200 million a year in additional grants and low-interest loans for system improvements, plus an annual $50 million to help towns and cities pay down mounting debt for water and sewer projects, the report said.
“Without that kind of support, it’s really going to be difficult to change the status quo,” said state Sen. Jamie Eldridge, D-Acton, who led the Water Infrastructure Finance Commission with Rep. Carolyn Dykema, D-Holliston.
Eldridge said he would file legislation next January to advance these and other goals.
Established two years ago, the commission released its final report recently in the shadows of massive pumps on display at the Metropolitan Waterworks Museum in Chestnut Hill.
Dykema said the backdrop was a reminder that Massachusetts has been a national leader in water infrastructure and still can be. She and Eldridge described clean, readily available water as crucial not only to public health and quality of life, but to economic development.
But paraphrasing Eldridge, Dykema acknowledged water infrastructure is not a “sexy” issue. The lawmakers emphasized the need to raise public awareness of the true cost and value of water and sewer systems and the consequences of inaction to modernize them.
Along with maintaining equipment that has seen few major upgrades in decades, water and sewer departments face higher costs to comply with new health, safety and environmental rules, the report said. At the same time, funding for improvements has dried up.
The $200 million-a-year investment the commission proposed would be on top of the existing state Clean and Drinking Water Revolving Funds, which the federal government helps fund. The state should hold steady its contributions to those funds, the report said.
The additional money should be set aside in a trust fund to ensure it goes to water and sewer projects alone, the report said.
If the state needs more revenue to fund the trust, it could come in part from an expanded Bottle Bill or new fees on pollutants, such as fertilizers and pesticides, the report said.
The commission discussed, but ultimately dropped an idea for a statewide surcharge on water and sewer rates to fund the trust.
However, the group said some towns and cities fail to charge water and sewer rates that cover the local costs of operations and planning ahead for maintenance and upgrades.
Such communities should make moderate, consistent increases to rates, the report said. The commission called on the state to offer towns guidance and incentives to set realistic, appropriate rates.
The report said rates under 1.25 percent of a community’s median household income should be considered affordable, a mark many towns and cities do not currently meet.
The commission also called for a push for towns and cities to adopt practices to cut unnecessary water and sewer costs and run their systems more efficiently. The state should give preference in funding to communities that have adopted such practices, as well as their ability to afford rate increases, the report said.
The report also said the state should encourage water and sewer projects that will improve the environment. Lastly, the commission called for promoting Massachusetts as a potential hub for the private water and sewer technology industries.
“Who better to lead the charge in that but Massachusetts?” Dykema said.
Eldridge said he envisions at least five separate bills to accomplish the commission’s goals, including one addressing ways to raise revenue.
He stressed the report reflected agreement among lawmakers, environmentalists and industry members of the commission. But he acknowledged the size of the gap at hand.
The commission acknowledged the $21.4 billion figure does not include the potential cost of federally mandated stormwater system upgrades. They could add another $18 billion to the 20-year price tag.
“It’s certainly going to be a challenge,” Eldridge said.