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Regional Stormwater Plan to Save Taxpayers Money in Luzerne County

This article is an excerpt from the December 2017 issue of The Authority, a magazine produced by the Pennsylvania Municipal Authorities Association (PMAA). It is the second in a series of 3 articles about an innovative approach to stormwater management and MS4 compliance being pioneered by 31 municipalities and the Wyoming Valley Sanitary Authority.  You can read the first article here: How Municipalities in the Wyoming Valley Are Cutting Stormwater Costs by Up to 90% )

 

Lower costs and increase value

Thirty-one municipalities in Luzerne County are piloting a regional approach to MS4 compliance that may revolutionize the way Pennsylvania responds to the growing challenges posed by stormwater.

They have signed cooperative agreements with the Wyoming Valley Sanitary Authority, which will serve as MS4 permit coordinator for the entire region. In our previous post, we discussed the many ways a regional partnership can lower the cost of stormwater management for municipalities.

In this post, we’ll discuss how:

Cooperation benefits the taxpayer.

If regional cooperation lowers the cost of stormwater management, it stands to reason those cost savings will be passed on to the taxpayer. But, make no mistake, replacing aging infrastructure and constructing Best Management Practices will cost money, and that money will have to come from somewhere.

With municipal budgets already stretched to the limit, communities may have to consider new revenue sources. That could mean a tax increase or a stormwater fee.

Stormwater fees are generally a better deal for the average constituent. This is because a fee structure ensures everyone pays their fair share.

If taxes were raised to cover the cost of stormwater management, many property owners with large amounts of impervious area would be exempt: hospitals, schools, and other non-profit institutions. However, these institutions can sometimes be the biggest contributors to a community’s stormwater issues because stormwater runoff occurs when the water runs along impervious surfaces and cannot infiltrate the ground.

If stormwater management is paid for through a property tax increase, these non-profit organizations won’t pay for the services they’re using, but someone will have to, and that burden will fall on homeowners and small businesses.

Studies show time and again that the average homeowner would pay less for stormwater management if he or she were charged a stormwater fee than if the municipality raised property taxes.

The regional cooperation being pioneered by the Wyoming Valley Sanitary Authority is an especially good deal for local taxpayers: Our analysis showed that the average residential property owner will save 70 – 93% by paying a regional stormwater fee instead of paying an increased property tax.

The Wyoming Valley Sanitary Authority’s estimated stormwater fee is between $3.00 and $4.50 per month. This is lower than the other stormwater fees currently being paid throughout Pennsylvania, which average between $6.50 and $8.50 per month.

By using a regional approach, WVSA is able to lower costs beyond what an individual municipal authority could likely achieve. These numbers are even more impressive when you consider that the fees for most of the other municipal authorities included in the average above were calculated before taking 2018 MS4 permit requirements into account. Therefore, those communities may actually have to raise fees higher to meet the stricter requirements coming in the next permit cycle.  WVSA’s estimated cost already accounts for the 2018 permit requirements.

Municipal leaders are stewards of the public’s money, but they are also stewards of the environment. In our next post, we’ll discuss how regional cooperation on stormwater management can more effectively keep our rivers and streams clean for drinking, agriculture, and recreation.


Do you want to learn more about how stormwater fees provide the best value for taxpayers? Download our guide:

Determining If a Stormwater Utility Is Right for Your Community

Stormwater Utility GuideIt includes
• Answers to common questions about stormwater utilities
• More advice for how to build public consensus for stormwater fees
• An outline of the early steps you should take when investigating the feasibility of a stormwater utility

Download the guide

 


 

Jim Tomaine has more than 30 years of engineering experience. He holds a bachelor’s degree in civil engineering from The Pennsylvania State University and a master’s degree in business administration from Wilkes University. He is the executive director of the Wyoming Valley Sanitary Authority and has been at WVSA for twenty seven years.  Prior to the WVSA, Mr. Tomaine worked in the private sector as a design engineer. He currently holds his A-1 Wastewater Treatment Plant Operators Certification in Pennsylvania and is also a registered professional engineer.

 

Adrienne Vicari is the financial services practice area leader at Herbert, Rowland & Grubic, Inc. (HRG). In this role, she has helped the firm provide strategic financial planning and grant administration services to numerous municipal and municipal authority clients. She is also serving as project manager for several projects involving the creation of stormwater authorities or the addition of stormwater to the charter of existing authorities throughout Pennsylvania.

 

How Municipalities in the Wyoming Valley are Cutting Stormwater Management Costs by up to 90%

This article is an excerpt from the December 2017 issue of The Authority, a magazine produced the Pennsylvania Municipal Authorities Association (PMAA). Contact us if you’d like a copy of the entire article.

Justify your rates with asset management

Thirty-one municipalities in Luzerne County are piloting a regional approach to MS4 compliance that may revolutionize the way Pennsylvania responds to the growing challenges posed by stormwater.

They have signed cooperative agreements with the Wyoming Valley Sanitary Authority, which will serve as MS4 permit coordinator for the entire region. The following are just a few of the ways that partnership will save them money over the next 20 years:

 

 

Less paperwork.

Because the municipalities are submitting their permit requirements as part of a regional approach, the Department of Environmental Protection (DEP) is allowing them to submit just one Cheasapeake Bay Pollution Reduction Plan (PRP) for the region and a single PRP for each impaired watershed (for a total of seven Pollution Reduction Plans).

If each municipality had chosen to work alone, the region would’ve submitted more than 100 Pollution Reduction Plans to DEP. When the cost of producing one Pollution Reduction Plan can be more than $20,000, the cost to produce more than 100 would simply have been out of reach for this region.

But, by working together, the municipalities reduce the amount of paperwork that must be produced to comply with state requirements.  Fewer plans cost less money, and that lower cost is then divided among the participating municipalities.  At the end of the day, each municipality’s share of the Pollution Reduction Plan preparation cost is just $3,000.

 

Fewer, more efficient construction projects

Submitting the Pollution Reduction Plan is just step 1 of the compliance process. Once the plan is accepted by DEP, municipalities must implement it, and that typically involves the construction of Best Management Practices (BMPs) that reduce the quantity and/or improve the quality of stormwater runoff.

The most expensive part of constructing BMPs is acquiring the land on which to build them. When municipalities work alone, they are limited to constructing their BMPs within their own borders, and most municipalities don’t have an abundance of publicly owned land available for BMP construction. If they partner with other municipalities on a regional approach, they can get credit for constructing BMPs anywhere within the watershed.  With that flexibility, communities can install projects that yield the greatest pollutant load reduction for the lowest cost.  This often means they can meet their goals with fewer construction projects.

According to our analysis, municipalities in the Wyoming Valley would’ve had to construct approximately 200 projects to meet the pollution reduction goals individually (at a cost of $69 million). As a group, the municipalities will only need to construct 65 projects to meet those goals (at a cost of just $12 million).  This will save the municipalities more than $50 million on the cost of implementing their Pollution Reduction Plans.

 

Lower O&M costs through economies of scale

There are a lot of fixed costs in managing stormwater.  When you spread those costs over a larger number of users, the cost to each user gets smaller.  A feasibility study conducted by WVSA’s engineer determined that, as a group, cooperating municipalities would save $274 million on operations, maintenance, and improvements over the next 20 years by working together on a regional approach to stormwater management.

 

Increased purchasing and borrowing power

Generally, you can negotiate lower unit costs for items when you buy them in larger quantities, so, for example, pipelines could be replaced or slip lined for a lower cost if the work was completed as part of a larger, regional project.

 

Increased access to government grants and loans

Funding agencies tend to favor entities that are cooperating regionally to streamline costs, and politicians tend to support projects benefitting a larger constituent base.  Therefore, funding applications submitted by a regional cooperative are more likely to be awarded a grant or loan than those submitted by individual municipalities. These funding awards can save a community significant sums of money versus funding a project out of its own revenues.

 

When municipalities save money like this, it stands to reason they can pass those savings on to residents and business owners. In a follow-up post next week, we’ll discuss how the regional partnership model being pioneered in the Wyoming Valley is benefitting taxpayers in the region.


Jim Tomaine has more than 30 years of engineering experience. He holds a bachelor’s degree in civil engineering from The Pennsylvania State University and a master’s degree in business administration from Wilkes University. He is the executive director of the Wyoming Valley Sanitary Authority and has been at WVSA for twenty seven years.  Prior to the WVSA, Mr. Tomaine worked in the private sector as a design engineer. He currently holds his A-1 Wastewater Treatment Plant Operators Certification in Pennsylvania and is also a registered professional engineer.

Adrienne Vicari is the financial services practice area leader at Herbert, Rowland & Grubic, Inc. (HRG). In this role, she has helped the firm provide strategic financial planning and grant administration services to numerous municipal and municipal authority clients. She is also serving as project manager for several projects involving the creation of stormwater authorities or the addition of stormwater to the charter of existing authorities throughout Pennsylvania.

How Dauphin County Has Turned a Small Surplus Into Major Infrastructure Improvements

This article is excerpted from the February 2018 issue of Pennsylvania County News magazine. It is provided courtesy of the County Commissioners Association of Pennsylvania (CCAP) and is reprinted here with their permission. This is in no way an endorsement by CCAP of the products or services offered by HRG.

What would you do with an extra $350,000 per year in your county Liquid Fuels budget?

It sounds like a nice problem to have, doesn’t it?

That’s exactly the challenge Dauphin County faced six years ago as its aggressive bridge management program reached a very important milestone: The last load-posted, structurally deficient bridge in the county’s inventory was fully programmed to be replaced.

This video tells the story of the last structurally deficient bridge in Dauphin County.  Once the county funded the replacement of this bridge, it had a surplus of Liquid Fuels money in its budget. They decided to use this surplus as seed money for an infrastructure bank that has funded more than a dozen roadway, traffic and bridge improvements throughout the county in just a few years. (Learn more about the county’s last structurally deficient bridge in this profile.)

For almost 30 years, the county had patiently and strategically planned the rehabilitation or replacement of 51 bridges. Close to 1/3 of its county-wide inventory had been structurally deficient at the time they embarked on this effort in 1984.

Now that hard work and determination was about to pay off. The county could drastically reduce its spending on bridge capital improvements by shifting from a replacement phase to a maintenance phase.

The county’s engineer, Herbert, Rowland & Grubic, Inc. (HRG), analyzed what investments would be necessary to proactively maintain the bridges and determined that the county would have an annual surplus of approximately $350,000 in Liquid Fuels funding beyond what was needed for maintenance expenses.

County commissioner Jeff Haste wanted to make sure the money was used wisely: “The county’s bridge management program had delivered tremendous value to our residents, drastically improving the safety and efficiency of our transportation system for drivers. We wanted to use this money to deliver even more value.”

Dauphin County Commissioners celebrate a ribbon cutting

County Commissioners Haste, Pries and Hartwick wanted to maximize the benefit of these surplus dollars for county residents. The infrastructure bank approach has allowed them to fund more than $11 million in improvements with an initial investment of $1 million.

Haste and his fellow commissioners, Mike Pries and George P. Hartwick, III, were thinking big, but regulatory requirements threatened to make the impact of this money small.

“Because of the forced distribution procedure associated with Liquid Fuels funding,” Haste explained, “the county had to come up with a use for this money or disburse it evenly to all 40 of our member municipalities.”

On average, each municipality would’ve received less than $10,000, which is too small a sum to do anything more significant that buy a little extra road salt for the winter.

Yet, even if the county used the entire $350,000 surplus itself, they wouldn’t be able to cover the cost of even one small capital improvement like a single-span bridge replacement (which typically costs between $500,000 to $1 million).

Haste, Pries and Hartwick wanted to have a larger impact, so they asked county staff to collaborate on a solution with the engineer who’d designed the successful bridge management program in the first place.

Together, they came up with an innovative program in which the county would use this annual Liquid Fuels surplus to dramatically reduce the cost of infrastructure improvements for local municipalities.

 

How the Dauphin County Infrastructure Bank Works

The Dauphin County Infrastructure Bank offers loans to municipalities (or private sector companies) to design and construct local roadway, bridge and traffic improvements – at unbeatably low interest rates. Municipalities can borrow money for as little as 0.5% interest.  (Private sector borrowers pay a 1% interest rate.)

As an added bonus, Dauphin County provides loan recipients with optional engineering design support. This is very beneficial to smaller municipalities who have never completed a large capital improvement project before and may not know how to navigate the complicated state and federal requirements these projects must meet.  An experienced consultant can save these municipalities from costly and time-consuming mistakes and re-work.

But, if $350,000 wasn’t enough money for the county to complete one major capital improvement project on its own, how can it use that money to fund multiple projects by its municipalities?

The power of partnerships.

Dauphin County multiplies the value of its $350,000 investment by combining it with additional funding from Pennsylvania’s state infrastructure bank.

Essentially, the county uses its Liquid Fuels surplus to make it more affordable for municipalities and private sector organizations to borrow money from the state by paying a portion of their interest. Interest on Pennsylvania Infrastructure Bank loans can vary, but it is currently 2.125% at the time this article is being written.

A municipality could borrow funds directly from the Pennsylvania Infrastructure Bank at an interest rate of just over 2%, or it could borrow from Dauphin County, and the county would pay approximately 75% of the interest expenses.

The following diagram shows exactly how the Dauphin County Infrastructure Bank funds its projects:

Diagram - How the Dauphin County Infrastructure Bank Works

It is a self-renewing process. As municipalities or private sector organizations repay their loan to the county infrastructure bank, the county repays PennDOT.  Once the debt is satisfied, the county has the ability to issue new loans to other municipalities or private sector companies.

For some municipalities, the cost savings provided by an infrastructure bank loan can be the difference between being able to move forward with a project at all or having to postpone it a few more years.

In the first three years of the infrastructure bank program, Dauphin County multiplied close to $1 million in Liquid Fuels funding into $11 million worth of improvements to the local transportation system: 7 bridges, one traffic signal, one streetscape, and one intersection improvement.

Middletown Streetscape

This streetscape project in Middletown Borough is one of the projects that has been funded by the Dauphin County Infrastructure Bank.  You can read more about the award-winning project and its potential economic benefit for the community in this article from The Authority.

“This is the kind of dramatic impact we were hoping to have,” says Pries, who oversees Dauphin County’s Community and Economic Development Department.

“The success of our bridge program and the creation of the Dauphin County Infrastructure Bank has allowed us to help residents without the need to raise property taxes. Unlike many other parts of the country, our residents don’t have to worry about crumbling bridges and road networks.”

Read more about the Dauphin County Infrastructure Bank, the benefits of implementing an infrastructure bank in your county, and other counties that are considering a program of their own in the February 2018 issue of Pennsylvania County News.


Do you want to make your community safer and encourage economic growth by investing in infrastructure? Download our guide:

Infrastructure Funding SolutionsCounty Infrastructure Banks:
Overcoming the Obstacles That Prevent Local Governments From Fixing Their Roads, Bridges, and Water Systems

It explains
• the benefits of a county infrastructure bank program
• how the program works (i.e. where the money comes from, how projects are selected, and how the projects are delivered)

Local governments want to improve their infrastructure but often don’t know where to come up with the money or even how to manage projects of that size and complexity. A county infrastructure bank program solves both of these problems, making infrastructure repair a feasible reality.

Learn how to fix your infrastructure

 


Brian Emberg, P.E.
Brian Emberg, P.E., is senior vice president and chief technical officer of Herbert, Rowland & Grubic, Inc. (HRG). He helped design Dauphin County’s bridge management system and worked with the county to develop the Dauphin County Infrastructure Bank. He has more than 30 years of experience designing roadways and bridges and is particularly skilled in creating unique funding solutions to help local governments accomplish their infrastructure goals with limited revenue.  You can contact Brian by phone at (717) 564-1121 or by email at bemberg@hrg-inc.com

WEBINAR: Cutting Stormwater Management Costs Through Partnerships

Photo by Aaron Volkening. Used under a Creative Commons license.
Stormwater inlet

Stormwater management costs are on the rise.
MS4 requirements continue to become more stringent.
Aging infrastructure is nearing its useful life and will need replacement.
Can your community afford to address these issues?

 Yes, and this webinar can help.

In it, we provide real-world examples of how municipalities are working together to reduce the cost of regulatory compliance and infrastructure O&M. We also provide guidance on how to successfully negotiate intergovernmental agreements that protect everyone’s interests.

Adrienne M. VicariThe presenter, Adrienne Vicari, is our Financial Services Practice Area Leader. Her regional approach to stormwater management is projected to save municipalities in the Wyoming Valley more than $200 million over the course of 20 years. PA DEP Secretary Patrick McDonnell praised the initiative, saying “By working together, these municipalities are reducing pollution less expensively than they could if they were making these efforts separately. I am certain that the rest of the state will be looking at their exemplary leadership.”

The webinar was produced in partnership with the Pennsylvania State Association of Township Supervisors (PSATS) and is eligible for 1 secondary credit to PSATS Municipal Government Academy (PMGA) enrollees.

PSATS members can view the webinar for $20. Non-members can view it for $25.

 

WEBINAR: Manage Your Infrastructure Easily and Cost-Effectively

Do you know the location of your infrastructure assets?

Do you know what needs inspected and when?

Do you know which assets are most critical and carry the highest risk to the community if they fail?

 

The answers to these questions are crucial to protecting the safety of people and property in your community.

You’re responsible for miles of infrastructure, and your job is to make sure it continues to function for the people you serve. Whether it be pipes and inlets, roadways, or bridges, you have to keep them performing at an acceptable level of service, and, more importantly, you must protect local residents and business from the consequences of failure.

This has always been a complex job, but new regulatory requirements, aging infrastructure, and tight municipal budgets make it even harder.

An asset management program can make it easier and more cost-effective, and this webinar will show you how.

Asset management is a proven methodology for determining where to best allocate your infrastructure dollars. It helps you cut through the questions and prioritize exactly what needs repaired or replaced. It can also help you effectively plan and mobilize the money to address those needs.

In this webinar, we’ll discuss:

  • What asset management is and how it works
  • What types of technology is available to assist with asset management and how to determine your particular needs
  • The many benefits of asset management for better targeting O&M dollars; providing justification for rates, fees or budget allocations; addressing government reporting requirements; and communicating with the public.

Howard HodderThe presenter Howard Hodder is our Director of Geomatics. He has worked with dozens of communities to create asset management solutions for water, sewer, stormwater and other infrastructure assets. He has also published several articles on the topic and spoken extensively at industry conferences.

The webinar was produced in partnership with the Pennsylvania State Association of Township Supervisors (PSATS) and is eligible for 1 secondary credit to PSATS Municipal Government Academy (PMGA) enrollees.

PSATS members can view the webinar for $20. Non-members can view it for $25.

 

Kevin Fox is a New Financial Services Team Leader

Kevin FoxKevin Fox has joined the Financial Services team at Herbert, Rowland & Grubic, Inc. (HRG). As a financial services team leader, Fox will develop financing strategies and assist clients with capital improvement project planning. He will also perform construction monitoring and construction control review to ensure that projects are financially viable and in compliance with funding program guidelines.

Fox has close to 30 years of experience in the engineering field, with a particular emphasis on water and sewer utilities. He has extensive experience calculating water and sewer rates and assisting with the management of utility budgets. He also has a master’s degree in both engineering and business administration and is a licensed engineer in Pennsylvania, Virginia, and Maryland.

 

ABOUT HRG

Founded in 1962, HRG has grown to be a nationally ranked Top 500 Design Firm, providing civil engineering, surveying and environmental services to public and private sector clients. The 200-person employee-owned firm currently has office locations in Pennsylvania, Ohio, and West Virginia. For more information, please visit our website at www.hrg-inc.com.

HRG to Speak and Exhibit at 2017 PMAA Conference

Join us at the Pennsylvania Municipal Authorities Association conference September 10 – 13, 2017. This year’s event is being held at the Hershey Lodge, and several HRG team members will be speaking:

 

Justin MendinskyErin ThreetJustin Mendinsky and Erin Threet will be discussing the Milton Regional Sewer Authority’s unique approach to meeting Chesapeake Bay nutrient reduction goals at its wastewater treatment plant. They’ll also be reviewing the impact of biological nutrient removal (BNR) on nitrogen levels within the Susquehanna River. (Monday September 11)

 

 

 

Tom HolleranTom Holleran will be participating in a panel discussion with representatives from Northern Blair County Regional Sewer Authority; M&T Bank; Link Computer Corporation; and the Fiore, Fedeli, Snyder & Carothers accounting firm. They’ll be discussing the discovery of a felony embezzlement at the Northern Blair County Regional Sewer Authority, specifically describing how the theft was executed.  They’ll also be offering tips authorities can use to protect themselves against embezzlement. (Monday September 11)

 

Adrienne VicariAdrienne Vicari will be talking about the innovative regional stormwater collaboration Wyoming Valley Sanitary Authority is forming with more than 30 municipalities in Northeastern PA. This partnership has garnered praise from DEP secretary Patrick McDonnell and is saving local municipalities millions of dollars in stormwater management costs associated with MS4 compliance. She will be joined at this presentation by Jim Tomaine of the Wyoming Valley Sanitary Authority and William Finnegan of Pugliese, Finnegan, Shaffer & Ferentino, LLC. (Tuesday September 12)

 

Chat with Justin, Erin, Tom, and Adrienne at booth #53 and enter our raffle. Ed Ellinger, Jeff Garrigan, and Kiana Tralongo will also be there.

We look forward to seeing you!

 

Adrienne Vicari Named One of Central PA’s Top 40 Under 40

Adrienne VicariThe Central Penn Business Journal named Adrienne Vicari to its 23nd annual Forty Under 40 list, which honors individuals for their commitment to business growth, professional excellence and the Central Pennsylvania community.  She and the other honorees will receive their award at a banquet on October 2 at the Hilton Harrisburg.

Adrienne is the financial services practice area leader at Herbert, Rowland & Grubic, Inc. She has more than 15 years of experience in financial consulting, project management and engineering design for municipal wastewater, water and stormwater clients. In her current role with the firm, she uses asset management and capital improvement planning as tools to complete long-range strategic financial planning for her clients.

But she began her career at HRG in a very different role: as a professional engineer designing water and wastewater treatment facilities. She quickly developed an interest in helping her water and wastewater clients obtain and manage their funding for capital improvement projects and transitioned into the firm’s financial service group. As communities have developed a growing need for increased stormwater management funding and utility valuation, she has become an industry leader in these areas, as well.

Russ McIntosh, a vice president of HRG, says:

“Adrienne is an unstoppable force. When she sees something needs done, she dives right in and gives it everything she has. She is extremely knowledgeable of the issues municipal water quality professionals face and very creative in addressing those challenges. There is nothing she can’t or won’t do to help her clients succeed.”

Adrienne Vicari volunteers for STEM educationThis dedication extends outside the office to the Central Pennsylvania community, as well. Adrienne encourages young people to achieve success in science, technology engineering, and math related fields by participating in STEM-related events like the “Introduce a Girl to Engineering Day” at the Whitaker Center. She also serves as a board member with the Girl Scouts in the Heart of Pennsylvania organization and takes part in their annual STEM expo. In addition, she coaches Central Penn Mini Sticks field hockey and a Cumberland Valley softball 10U team.

She also co-founded a women’s volunteer group for West Shore mothers that encourages them to pursue diverse volunteer opportunities with their children. The group has had a significant impact on mid-state organizations such as Caitlin Smiles, Leg Up Farm, Ronald McDonald House, Dress for Success, and others.

 

ABOUT HRG

Originally founded in 1962, HRG has grown to be a nationally ranked Top 500 Design Firm, providing civil engineering, surveying and environmental services to public and private sector clients. The 200-person employee-owned firm currently has office locations in Pennsylvania, Ohio, and West Virginia. For more information, please visit the website at www.hrg-inc.com.

 

Infrastructure Asset Management: Business Principles to Maximize Government Revenue Returns

This post is an excerpt from an article we published in the June 2017 issue of Borough News magazine entitled “Strategic Asset Management: Optimizing Your Borough’s Dollars.”

We hear a lot these days about the virtues of running government like a business, but what does that mean?

Any profitable business owner can tell you that success doesn’t happen by accident. Managers spend a good bit of time and money studying the environment in which they operate, identifying opportunities and threats, and planning the best ways to maximize growth while minimizing risk.

Though these efforts cost money, prudent managers know it is an investment in the company that will pay higher dividends over the long-term.

Part of a businessman’s overall strategic planning effort involves cataloguing his assets and maximizing their value. Assets can be wide-ranging: from people to trucks to buildings. The goal of asset management is to optimize the way you spend your budget dollars in order to make sure they are providing the biggest return: reducing the life cycle costs while maximizing the service each asset provides.

Who needs to optimize the way they spend their budget dollars more than cash-strapped municipalities under pressure to keep taxes low while obligations increase?

Most municipalities are grappling with aging infrastructure. Take water systems, for example: The American Society of Civil Engineers estimates that the cost to keep our water and wastewater system functioning over the long term is more than $1 trillion. While there is plenty of work to be done, there is simply not enough funding for communities to do it all at once. Therefore, ASCE recommends assessing the condition of every pipe and valve to determine the risks of failure and properly allocate funds where they are needed most. Asset management and capital improvement planning can help you target your limited budget dollars most effectively in all types of infrastructure: roadways, bridges, stormwater management systems and more.

For example, new technology is making it possible for municipalities to extend the life of their roadways through roadway management systems. Cameras and laser-scanning technology can be mounted to trucks that record the conditions of a municipality’s entire roadway system: noting cracks, pot holes, wheel rutting, and more. Doing this work manually would’ve been too labor-intensive and cost-prohibitive for communities in the past, but now, thanks to technological advancements, municipalities can collect better data at a lower cost without road closures or detours!

Once the data is collected, the municipality can work with an engineer to analyze it and prioritize a list of maintenance, repairs and reconstruction needs. A roadway management program like this emphasizes cost-effective, preventative maintenance activities to prolong the life of a roadway in good condition. By making well-timed, proactive investments, the municipality can enjoy better service from the roadway at a lower lifetime cost.

Silver Spring Township Roadway Management Program

HRG has designed a roadway management program for Silver Spring Township that is helping them save money and better position themselves for grant funding. Learn more

The same asset management and capital improvement principles can be applied to bridges, as well. Typically, this is done at the county level since they own more bridges than municipalities, but the process is similar. When Dauphin County first embarked on its bridge management program, 1/3 of its bridges were structurally deficient. They carefully catalogued the condition of each bridge and prioritized repairs and replacement contracts. Today, they have successfully eliminated all load-posted, structurally-deficient bridges in the county. The program has been so successful it’s generated a surplus of liquid fuels funding, and the county has been able to funnel that into a subsidized loan program for its municipalities to address their own infrastructure needs.

Duke Street Ribbon Cutting

Thanks to careful planning and a wise use of funds, Dauphin County recently completed the replacement of its last load-posted, structurally deficient bridge. Now they can use their Liquid Fuels money for an innovative infrastructure bank that is helping municipalities and the private sector improve local communities. Learn more

Asset management programs can be very important to municipalities looking to meet their MS4 stormwater obligations, as well – particularly if they are considering the implementation of a stormwater fee. Aging infrastructure and growing MS4 permit obligations are compelling municipalities to upgrade their stormwater systems. Though legislation allows them to charge a stormwater fee, they must be able to justify it, which means they must conduct a thorough inventory of their facilities and document the work that must be done to keep it functioning (along with cost estimates for that work). These are crucial facets of an asset management system.

Mobile GIS Development for MS4 Inspections

Municipalities will need a thorough inventory of their stormwater facilities and their condition in order to keep up with the increasing burden of MS4 permitting. Learn about a GIS application HRG created for Hampden Township to help them meet MS4 inspection and reporting requirements.

 

What is asset management?

Asset management is a systematic approach to minimizing the cost of owning, operating, and maintaining your infrastructure at acceptable levels of service.

It is not a computer system or GIS, though these are often valuable tools employed in an asset management program for record-keeping and data analysis.

A proper asset management and capital improvement program will help a municipality identify areas where money is not being spent wisely and reallocate those funds where they can be most beneficial.

It will also help you recognize and evaluate options for keeping your assets functioning for a longer period of time, so that you don’t need to invest in expensive upgrades or replacements as frequently.

It is a circular process that never ends.

Circular Nature of Asset Management

Many things change over time: the condition of your assets, regulations and the business climate you operate in, the number of users you serve, etc.  A good asset management and capital improvement program helps you plan for these changes in advance and respond proactively before they become threats to your bottom line.

 

What are the benefits of infrastructure asset management?

As we’ve already stated, an asset management and capital improvement program helps you identify exactly what maintenance and repair work is necessary without guesswork. This approach has multiple benefits:

Minimizing Risk
Knowing which infrastructure is most likely to fail (and correcting deficiencies before it does) can save you major expenses later. Knowing which failures would be the most catastrophic helps you target money toward their prevention as a first priority.

Maximizing Returns
Asset management and capital improvement planning is all about proactively investing in measures to extend the life of your infrastructure.  These small investments can extend the life of an asset by several years.

Optimizing Service and Satisfaction
Proactively maintaining your assets ensures they function at peak performance for a longer period of time and are replaced before they fail. This means your constituents receive top quality service without disruption and are happier for it. In addition, many asset management solutions include optional customer service applications that make it easier for residents and business owners to submit service requests and track them to completion.

Justifying Your Tax Rates or Fees
Rate increases are never popular, but they are easier for people to accept when they are backed up with clear data showing exactly what improvements are needed and why.

Accessing grants and loans
Competition for funding is fierce, and government agencies are under pressure to make sure the money they invest is used wisely. As a result, they’re more likely to award funds to municipalities who have clear documentation of the project need, its benefits, and a plan for getting it built, operating it, and maintaining it at optimum levels over time.

Improving your worth
Many municipalities have been considering the option of leasing or selling their assets as a response to growing financial obligations in the public sector. A comprehensive asset management system provides documentation of the value of your assets, so you can ensure you are in a position to negotiate the best possible deal for you and your constituents.  Potential investors will be more comfortable making a significant investment if they fully understand the value and the risks they’re assuming.

But asset management can benefit your financial picture even if leasing or selling is not on the horizon.

Under GASB standards, governments can either subtract a standard portion of their infrastructure’s value each year to account for depreciation (the traditional approach), or they can regularly assess the condition of the infrastructure, invest in maintenance to keep it in good condition, and then report the amount of money they have invested in maintenance (the modified approach, which is similar in scope to a typical asset management program).  Using the modified approach, the assets don’t have to depreciate in value like they would in the traditional approach.

A recent article in Governing magazine showed how investors appear to prefer trading bonds from governments that use the modified approach:

“Governments that use the modified method trade at much narrower price ranges compared to bonds from governments that depreciate. In other words, when a government uses the modified approach, investors are much more likely to agree on how to price its bonds. For governments, this can ultimately translate into lower bond interest rates.”

(excerpted from “Selling Your Sewer’s Story – Financial statements can make the best case for public works investors”)

 

The truth is, you’re going to have to invest in maintenance and repair anyway. If you invest in an asset management program, you can take a proactive approach to determining what maintenance is needed and then plan and budget for it in advance. This means you can target your maintenance dollars where they’re needed most and make sure you have the funds available to do the work before infrastructure failure brings even greater costs to bear on your budget.

Publicly-traded companies are held accountable to their shareholders. They must demonstrate that they are making good decisions for the future health of the company and maximizing the value of the shareholders’ investments. Taxpayers are coming to demand the same sort of accountability from their government, wanting proof that their tax dollars are providing a good return, as well. Municipal managers that can prove the value of their decisions will enjoy broad support of their constituents while improving the long-term financial stability of their community.


Adrienne M. VicariAdrienne Vicari, P.E., is the financial services practice area leader at Herbert, Rowland & Grubic, Inc., a civil engineering firm that serves local governments and authorities in Pennsylvania, Ohio, and West Virginia. Ms. Vicari has assisted numerous municipalities and water and sewer authorities with the creation of asset management programs that have created increased value and lowered costs for her clients.

 

HRG Professionals Headlining 9 Presentations at PENNTEC 2017

HRG professionals will be headlining nine presentations at the PENNTEC conference next week. The Pennsylvania Water Environment Association will be hosting this conference June 4 – 7 at the Kalahari Resort & Convention Center in Pocono Manor. 

 

Matthew Cichy

What to Know Before You Collect Asset Data for GIS (Monday June 5)
Matt Cichy will discuss who can complete the data collection and how it should be done. He will also present the lessons he has learned from many years of experience collecting sanitary and storm sewer system asset data for use in GIS.

 

Howard Hodder
Web-based Technologies for the Inventory, Operations and Maintenance of your Assets
(Monday June 5)
Howard Hodder will provide an overview of the latest web-based GIS technology (ArcGIS). He’ll also explain how its simplicity enables municipalities large and small to build and maintain robust databases in-house, making asset management a viable solution. His experience assisting Lower Swatara Township Municipal Authority with a successful implementation of the technology will serve as the basis of discussion.

 

Ben Burns
Big Hollow Diversion Pump Station Expands Capacity and Eliminates Stormwater Issues
(Monday June 5)
Ben Burns will describe the Big Hollow Diversion Pump Station he designed for the University Area Joint Authority. This 18.8 MGD facility provides capacity for the build-out projections presented in the authority’s most recent Act 537 plan.  It also removes a section of interceptor pipe that was installed at ground level and had been causing stormwater to backwater.  The pump station incorporates a diversion pumping system that uses a second forcemain to pump high flows around hydraulically limited segments of a gravity interceptor.

 

Justin Mendinsky
Belt Dryer Performance Evaluation: Is the Bang Worth the Buck?
(Monday June 5)
Justin Mendinsky will discuss his experience working with the Milton Regional Sewer Authority on the installation of a new belt dryer designed to produce Class A biosolids from the processing of dewatered, waste-activated and waste anaerobic sludge. The belt dryer will operate using direct exhaust from two 1-Megawatt generators as the primary source of drying.  Justin’s presentation will detail the dryer’s performance, the cost of operation, and the process variability (as impacted by sludge feedstock type, dewatering system equipment, and generator operations).

 

Adrienne M. Vicari
Selling, Leasing or Retaining Public Utility Systems
(Tuesday June 6)
Adrienne Vicari will offer insight into the strategies municipalities are using to ensure their utility systems are financially secure and operating efficiently.  She will specifically discuss the leasing or sale of public utilities to private companies or other public systems and will explain the ways the valuation process is impacted by Act 12 of 2016.  She and her co-presenters will present the pros and cons of using the new approach outlined in Act 12 versus the traditional approach for utility valuation.  They will also discuss the importance of conducting a cost-benefit analysis to determine if selling or leasing a public utility is the best option for the community.  Finally, she and her co-presenters will highlight best practices for ensuring financial and operational stability.  Funding agency representatives will discuss funding sources for capital improvements.

 

Miller
Replacing Failing OLDS with Low-Pressure Sewer Collection Facilities and a New Treatment Facility
(Tuesday June 6)
Jennifer Miller and Mark Deimler (of Strasburg Township) will discuss Strasburg’s experience installing a new low-pressure sewage collection system and a recirculating sand filter treatment facility. Their presentation will focus on public outreach and construction sequencing as crucial factors in the project’s success.

 

Chad Hanley
The Long-Road to Planning and Implementing a New Municipal Sanitary Sewage System in Greene Township
(Tuesday June 6)
Chad Hanley will discuss the challenges of implementing a new sewage collection system in rural areas. He will describe how public outreach efforts helped Greene Township overcome resistance from homeowners to the cost of connecting to the system.  He will also discuss how intergovernmental cooperation and an investigation of alternative technologies helped to lower project costs.

Cranberry Highlands Golf Course: A Look Back at 15 Years of Reuse (Wednesday June 7)
Chad Hanley will discuss the successes and lessons learned from using wastewater effluent for irrigation at the Cranberry Highlands Golf Course for the past 15 years.  This highly successful project serves as a model example of the benefits of water reuse. 

 

Josh Fox
Regional Wastewater Effluent Solutions for Irrigation Issues
(Wednesday June 7)
Josh Fox will be discussing the ramifications of using wastewater effluent for golf course irrigation.  Fox evaluated the use of wastewater effluent for irrigation at the Sunset Golf Course in Dauphin County, and his presentation will describe the obstacles he overcame to create a successful project.  It will also discuss the potential implications this project holds for the community in terms of water conservation and improved water quality.

 

We look forwarding to seeing you there!