AMSA Member Update (MU04-06)

In November 2002, Senator Jim Jeffords (I-VT), the ranking member of the Senate Environment and Public Works Committee, requested the U.S. General Accounting Office (GAO) to examine several aspects of utility asset management, including: 1) the potential benefits of comprehensive asset management for drinking water and wastewater utilities and the challenges that could hinder its implementation, and 2) the role that the federal government might play in encouraging utilities to implement asset management. In response, GAO recently released Water Infrastructure: Comprehensive Asset Management Has Potential to Help Utilities Better Identify Needs and Plan Future Investments (GAO-04-461) (http://www.gao.gov/new.items/d04461.pdf). The report shows that utilities benefit from implementing asset management programs and makes various recommendations to the U.S. Environmental Protection Agency (EPA) regarding asset management. The primary recommendation is that EPA should do more to make asset management information accessible to drinking water and wastewater treatment utilities.

GAO Report Shows Utilities Can Benefit from Asset Management
In preparation for its report, GAO conducted initial interviews with 46 U.S. wastewater and drinking water utilities then conducted in-depth interviews with 15 of those utilities. Several AMSA members were interviewed for this report, and then the utility representatives interviewed reported several benefits from implementing asset management programs, including: 1) improved decision-making due to better data on their capital assets and 2) improved relationships with regulators, ratepayers, and other stakeholders because of the availability of more accurate information about their systems. Utilities also reported a number of challenges associated with the implementation of asset management, including limited resources and intra-departmental coordination.

Report Says EPA Should Make Information More Accessible, Improve Outreach
The GAO asked utilities and utility associations about the role the federal government should play in encouraging the implementation of asset management. Utility representatives did not favor federal mandates or requirements for asset management plans, particularly as a condition on receiving federal financial assistance. Based on utility input, however, GAO did recommend a greater role for EPA in gathering, coordinating and making available information on asset management. GAO also found support for the creation of a new EPA website that would serve as a central repository of information along with easy access to implementation tools and training materials, as well as more effective Agency promotion of these tools.

Jeffords Calls on Congress to Support GAO’s Findings
In a statement following release of the GAO report, Senator Jeffords said improved spending decisions by utilities and local elected officials as a result of the implementation of asset management programs is ‘one piece of the puzzle.’ Jeffords said, “It must be coupled with the proper federal investment in water infrastructure. Without it, this nation risks losing the water quality protections we have gained in the last 30 years.”

Legislation in both the House and the Senate in recent years has contained language on asset management. At issue has been whether bills to reauthorize the funding sections of the Clean Water Act and Safe Drinking Water Act should include requirements or mandates on asset management. AMSA has taken the position that asset management planning involves site-specific determinations that are best left up to the utilities themselves. In line with this view, the GAO report does not recommend any regulatory activity, but found that water and wastewater utilities would be well served by a more robust EPA outreach and information-sharing program that would promote the implementation of asset management.

AMSA, which has published Managing Public Infrastructure Assets and featured asset management issues at conferences and workshops will continue to work with EPA to make sure the best information is made available to the nation’s publicly owned treatment works. Also, AMSA's Asset Management Workgroup will meet on May 23rd during the 2004 National Environmental Policy Forum, held May 22-26 in Washington, DC, to discuss the Association's future asset management initiatives. Plan to attend this committee meeting and join in the Workgroup's efforts. Contact Lisa Headley, AMSA's Managing Director of Member and Internal Services, to join the Asset Management Workgroup or with any questions you may have on this topic, at 202/833-3692 or lheadley@amsa-cleanwater.org.