NJ Infrastructure > Infrastructure by Category > Drinking Water

Infrastructure by Category:
Drinking Water (Grade C)

Introduction
Are we investing enough in our drinking water infrastructure? A preliminary comparison of spending versus investment needs suggests that New Jersey has a drinking water infrastructure investment funding gap of at least $60 million per year. While water supply and treatment are integral to ensuring safe drinking water is provided to all New Jersey residents, the State's water distribution systems may require the most attention. Deteriorating distribution infrastructure threatens drinking water quality and wastes water and energy through leaks and main breaks. The State's drinking water infrastructure requires more capital and operations and maintenance (O&M) investments to ensure residents continue to be provided with water at an acceptable level of service - that is, water of acceptable quality, in acceptable quantity, with adequate pressure, and with an acceptable degree of service interruption.

Current Conditions
Supply: Public water systems serve 80% of the State's residential population, while private domestic wells serve the remaining 20%. Central and northern New Jersey contain the 20 largest community water systems serving 50% of the state population. Water is drawn from one of 45 surface water intakes at rivers, lakes, and reservoirs, or one of 2,434 groundwater wells. Southern New Jersey is mostly served by groundwater.

New Jersey faces many challenges in ensuring an adequate supply of clean water:

The 2007 State of New Jersey Environmental Policies and Action Plan identifies the "provision of clean and plentiful water" as a current priority which will have a concentrated focus over the next three years. Specific elements of the action plan include:

Treatment: While most New Jersey residents receive water from public water systems that operate without significant EPA violations, the number of systems in violation of regulations is trending upward. According to USEPA's 2004 National Public Water Systems Compliance Report, New Jersey's water systems were cited for a total of 17,776 violations - reflecting a 9% increase in total violations over 1999 levels. However, maximum contaminant level (MCL) violations only account for approximately 2% of total violations, while monitoring violations account for greater than 95% of total violations. Most of New Jersey's MCL violations are due to exceedances of acceptable total coliform and nitrate levels.

The State's Capacity Development Program provides technical, managerial and financial assistance (through the Drinking Water State Revolving Fund Program) to help water systems with a history of significant non-compliance return to and remain in compliance with the Safe Drinking Water Act (SDWA) regulations. A 2005 report on the Capacity Development Program indicates that the number of systems with a significant non-compliance history decreased from 9% in 1997 to 2% in 2003. It is anticipated that total SDWA violations will decrease as more systems seek the assistance provided by the Program.

Distribution: Transmission and distribution systems generally account for most of a system's capital value. But invisibility often leads to funding for this buried infrastructure being usurped by more visible above ground projects. Consequently, residents are reminded of buried infrastructure when it is deteriorating or already in poor condition. When mains break and disrupt water service, flood basements and impede the flow of traffic, or when tap water has taste, odor and red water (due to iron corrosion) problems, the need for continued investments in underground infrastructure becomes more evident.

Most distribution piping installed in the US from the late 1800's until the late 1960's was manufactured from cast iron, and many of these pipes now need to be replaced. The oldest cast iron pipes, dating to the late 1800s, have an average life expectancy of about 120 years. Because of changing materials and manufacturing techniques, pipes laid in the 1920s have an average life expectancy of about 100 years, and pipes laid in the post-World War II boom can be expected to last about 75 years . However, the rate of deterioration of a water system is not merely a function of material age . The cumulative effect of the external forces acting on buried pipe is extremely important. For example, while 70 year-old unlined cast iron pipe may be expected to last for another 60 years in some systems, 50 year old pipe in a different location may already show signs of failure. Variations in temperature, internal and external corrosion, and the occurrence of hydraulic surges all impact the life expectancy of underground piping.

The 2001 AWWA study "Dawn of the Replacement Era - Reinvesting in Drinking Water Infrastructure" recommends developing comprehensive local strategies to address infrastructure repair and replacement challenges. Specifically, the comprehensive strategy should include:

Future Outlook
The state's drinking water infrastructure requires capital and O&M investments to ensure NJ residents continue to be provided with water at an acceptable level of service. The projects supported by capital spending include constructing raw water intakes, impoundments, wells, treatment plants, and storage tanks; installing standby power generators; replacing aging and deteriorated water mains; and installing booster pumping stations to maintain adequate distribution system pressure. The projects supported by O&M spending include rehabilitating storage tanks, refurbishing pipes to remove build-up on pipe walls (Figure 1) and looping dead-end mains to avoid stagnant water.

Based on responses to a 2003 survey, the EPA estimated $6.9 billion in capital investments would be needed over the next 20 years to install, upgrade and replace New Jersey's drinking water infrastructure . These investments are needed to preserve the physical integrity of water systems and ensure continued compliance with regulations. Approximately 54% of the investment estimate represents funding for current-needs projects. These near-term, high-priority projects (such as replacing distribution pipe with a history of leaks and breaks) enable a system to continue delivery of safe drinking water. The remaining 46% of the investment estimate represents funding for future-needs projects - projects that water systems do not currently need, but would expect to address in the next 20 years as part of routine rehabilitation or replacement of infrastructure for predictable events (such as reaching the end of a facility's service-life). The $6.9 billion estimate does not account for future-needs capital projects undertaken solely to accommodate future growth.

Are New Jersey's public water systems spending enough? A cursory review of capital investment data for four of New Jersey's water systems (three privately held and one municipality) suggests that additional capital investment may be required by New Jersey's water systems. The combined annual investment for these four utilities, which combined serve approximately 40% of the State's population, averages just over $200 million per year. Of the $6.9 billion in capital investments required by New Jersey's systems over the next 20 years, $5.1 billion is needed for transmission and distribution systems. This $5.1 billion translates into an annualized cost of approximately $560 million per year (in 2003 dollars). Assuming that the required investment is proportional to population served, the four systems surveyed fall short of the required annual investment. Given that privately held utilities typically have larger capital investments than publicly owned water systems, and that the investment estimates obtained for this analysis were primarily based on information from privately held utilities, the data suggests that the funding gap for New Jersey's water systems may well exceed $60 million per year.

The analysis provides a starting point for determining the magnitude of the drinking water infrastructure funding gap. While the data available represents a reasonable effort to quantify the funding gap, more detailed statewide data would assist in better quantifying the problem and projecting the impact of potential remedies.

Policy Recommendation

Conclusion
Based on the data and discussion presented, ASCE assigned a Grade of C to New Jersey's Drinking Water Infrastructure. The ASCE grading system primarily considered funding levels for drinking water infrastructure. Grades were based on the following scale:

A = 90 - 100%
B = 80 - 89%
C = 70 - 79%
D = 41 - 69%
F = 40% or lower

The preliminary funding gap analysis determined a need of $560 million annually versus spending of approximately $500 million annually, which would correspond to a "B" for New Jersey's drinking water infrastructure. However, the limited data used to obtain this estimate presents uncertainty. Also, in 2005, ASCE graded the National Drinking Water Infrastructure with a "D-" . To account for uncertainty and the lower national grades, ASCE adjusted the grade given to New Jersey's Drinking Water Infrastructure to a "C".