September 24, 2013

 

State Lawmakers Aim to Reform Municipal Procurement of Water and Sewer Piping


State leaders have joined federal and local lawmakers calling for more open competition in the procurement of water and sewer piping. The U.S. Conference of Mayors estimates that renewing the nation's underground piping will cost $2.28 trillion over the next 20 years. With revenues for State Revolving Funds (SRFs) in serious decline, there is a tremendous need for municipalities to get more bang for the buck from their water and wastewater infrastructure projects. A new report by the American Legislative Exchange Council (ALEC) argues that municipal bidding processes must be more competitive and include non-corroding materials like PVC pipe, which will result in lower costs and more sustainable water infrastructure. A shift in pipe selection from iron materials to PVC could generate savings of $370 billion nationwide. “While innovative and cost-effective products and technologies are readily available, these products are often excluded from consideration.” The report cites the “habituation factor,” or “the tendency of government officials to select the materials they are comfortable with and have used for years.”

“The primary cause of premature pipe failure is corrosion, so the choice of piping material is critical to keeping long-term maintenance costs down and minimizing capital-replacement budgets… Competitive bidding that allows for the consideration of alternative, yet proven and accepted, piping materials can result in enormous savings,” says study author Bonner R. Cohen, Ph.D., a senior fellow at the National Center for Public Policy Research in Washington, D.C. Click here for report.

   

Lack of Open Competition and Corrosion of Underground Infrastructure: The Chorus Gets Louder


ALEC’s study, titled “Lowering Costs in Water Infrastructure through Procurement Reform: A Strategy for State Governments,” is the latest in a long line of reports published by highly influential organizations like the U.S. Conference of Mayors (USCM), National Taxpayers Union (NTU) and the Competitive Enterprise Institute (CEI) on the need for more competition and innovation in the procurement of underground piping. Other groups like the U.S. Water Alliance, Water and Wastewater Equipment Manufacturers Association, and the Water Finance Research Foundation have expressed similar views. “Only by modernizing procurement practices and the assumptions upon which pipes are selected can municipalities achieve much needed cost-savings and performance improvements in their underground infrastructure at a time of dwindling resources,” says Richard F. Anderson, Ph.D., Senior Advisor, U.S. Conference of Mayors Water Council.

Significantly, all the reports point out how metallic pipe corrosion is driving up water rates and undermining the long-term sustainability of our water systems. The solution is broader access to better performing and more cost-effective technologies like PVC pipe. The outdated practice of choosing less durable, corrosion-prone metallic pipes without a full financial evaluation must end. With corrosive soils affecting 75 percent of all U.S. water utilities, coupled with significant iron pipe wall thickness reductions over the last century, iron pipe longevity has plummeted according to the NTU.


The Open and Fair Competition Act for Water and Wastewater Projects

   
ALEC is a nonpartisan, voluntary membership organization comprising nearly one-third of the country’s state legislators. Included in its report is model legislation, “The Open and Fair Competition Act for Water and Wastewater Projects,” which state legislatures across the country are encouraged to enact. The Act will require municipalities that receive funding from SRFs to include all piping materials that meet recognized standards set by the American Society of Testing Materials (ASTM) and the American Water Works Association (AWWA) in their bidding processes. As well, municipalities will have to “consider quality, sustainability, durability, and corrosion resistance when procuring piping material.” By ensuring that open procurement practices are used in the selection of underground piping, projects can be constructed at the best price and best value for system customers and taxpayers. The proposed legislation replicates open competition policies already in place for more than a decade with the U.S. Department of Agriculture for funding it provides rural municipalities for their water and sewer projects. Click here for model legislation.

Regards,

Bruce Hollands
Executive Director | Uni-Bell PVC Pipe Association
2711 LBJ Freeway, Suite 1000 | Dallas, TX 75234

T. 972.243.3902 ext. 1019 | C. 214.244.9202 | F. 972.243.3907

www.uni-bell.org