Musings – I was sent this on the internet. No clue the source.
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Leadership
Sea Level Rise Planning Part 2
In the last blog we discussed 10 planning steps for sea level rises. When planning 50-100 years other factors can come into play as well. As a result, to allow flexibility in the analysis due to the range of increases within the different time periods, an approach that uses incremental increases of 1, 2, and 3 feet of SLR is suggested. Hence infrastructure is built to meet milestones, not arbitrary dates lessening the potential for stranded assets.. The increments can work as threshold values in planning considerations in terms of allowing planners the ability to know ahead of time where the next set of vulnerable areas will be to allow a for proactive response approach that can be matched to the observed future sea levels.
But prior to developing infrastructure plans, the local community needs to define an acceptable level of service (LOS) for the community. A level service would indicate how often it is acceptable for flooding to occur in a community on an annual basis. 1% is 4 days per years and for a place like Miami Beach, this is nearly 2 ft NAVD88, well above the mean high tide. The failure to establish an acceptable LOS is often the cause of failure or loss of confidence in a plan at a later point in time. The effects of SLR of the level of service should be used to update the mapping to demonstrate how the level of service changes, so that a long-term LOS can be defined and used for near-term planning.
With the LOS known, the vulnerability assessment is developed using a GIS based map of topography and the groundwater levels associated with wet and dry season water levels. LiDAR is a useful tool that may be available at very high resolution in coastal areas. Topographic maps must be “ground-truthed” by tying it to local benchmarks and transportation plans. USGS groundwater and NOAA tidal data from local monitoring stations to correlate with the groundwater information. Based on the results of these efforts, the GIS-based mapping will provide areas of likely flooding.
GIS map should be updated with layers of information for water mains, sewer mains, canals, catch basins, weirs and stormwater facilities. Updating with critical infrastructure will provide a view of vulnerability of critical infrastructure that will be funded by the public sector. Ultimately policy makers will need more information to prioritize the needed improvements. For example, a major goal may be to reduce Economic Vulnerability. This means identifying where economic activity occurs and potential jobs. At-risk populations, valuable property (tax base) and emergency response may be drivers, which means data from other sources should be added.
The next step is to analyze vulnerability spatially, by overlaying development priorities with expected climate change on GIS maps to identify hotspots where adaptation activities should be focused. This effort includes identification of the critical data gaps which, when filled, will enable more precise identification of at risk infrastructure and predictions of impacts on physical infrastructure and on communities. The final deliverable will include descriptions of the recommended concepts including schematics, cost estimates, and implementation plan.
So why go through all this. Let’s go back to the beginning. It has to do with community confidence in its leaders. Resident look at whether their property will be protected. Businesses look at long-term viability when making decisions about relocating enterprises. The insurance industry, which has traditionally been focused on a one year vision of risk, is beginning to discuss long-term risks and not insuring property rebuild is risk-prone areas. That will affect how bankers look at lending practices, which likely will decrease property values. Hence it is in the community’s interests to develop a planning framework to adapt to sea level rise and protect vulnerable infrastructure through a long-term plan. Plan or….
Sea Level Rise Planning – Part 1
The rainy season has sort-of started in south Florida and with it comes flooding and discussions of the falls end of season and concurrent high, high tides for the year, flooding and the impact of sea level rise on low-lying areas. Much focus has been spent on the causes of sea level rise and the potential flooding caused by same. However the flooding can be used as a surrogate to impacts to the social and economic base of the community. By performing vulnerability assessments, coastal areas can begin planning for the impacts of climate change in order to safeguard their community’s social, cultural, environmental and economic resources. Policies need to focus on both mitigation and adaptation strategies, essentially, the causes and effects of climate change. Policy formulation should be based on sound science, realizing that policy decisions will be made and administered at the local level to better engage the community and formulate local decisions.
Making long-term decisions will be important. Businesses look at long-term viability when making decisions about relocating enterprises. The insurance industry, which has traditionally been focused on a one year vision of risk, is beginning to discuss long-term risks and not insuring property rebuild is risk-prone areas. That will affect how bankers look at lending practices, which likely will decrease property values. Hence it is in the community’s interests to develop a planning framework to adapt to sea level rise and protect vulnerable infrastructure through a long-term plan.
While uncertainties in the scale, timing and location of climate change impacts can make decision-making difficult, response strategies can be effective if planning is initiated early on. Because vulnerability can never be estimated with great accuracy due to uncertainty in the rate of warming, deglaciation and other factors, the conventional anticipation approach should be replaced or supplemented with one that recognizes the importance of building resiliency. The objectives of the research were to develop a method for planning for sea level rise, and providing a means to prioritize improvements at the appropriate time. In addition the goals were to provide guidance in developing a means to prioritize infrastructure to maximize benefit to the community by prioritizing economic and social impacts.
Adaptation planning must merge scientific understanding with political and intuitional capacity on an appropriate scale and horizon. According to Mukheibir and Ziervogel (2007), there are 10 steps to consider when creating an adaptation strategy on the municipal level. To summarize, these are as follows:
- Assess current climate trends and future projections for the region (defining the science).
- Undertake a preliminary vulnerability assessment of the community and communicate results through vulnerability maps (using GIS and other tools).
- Analyze vulnerability spatially, by overlaying development priorities with expected climate change on GIS maps to identify hotspots where adaptation activities should be focused.
- Survey current strategic plans and development priorities to reduce redundancy and understand institutional capacity.
- Develop an adaptation strategy that focuses on highly vulnerable areas. Make sure the strategy offers a range of adaptation actions that are appropriate to the local context.
- Prioritize adaptation actions using tools such as multi-criteria analysis (MCA), cost-benefit analysis (CBA) and/or social accounting matrices (SAM).
- Develop a document which covers the scope, design and budget of such actions (what they call a Municipal Adaptation Plan (MAP)).
- Engage stakeholders and decision-makers to build political support. Implement the interventions prioritized in the MAP.
- Monitor and evaluate the interventions on an ongoing basis.
- Regularly review and modify the plans at predefined intervals.
The strengths of this framework are the initial focus on location-specific science, the use of both economic and social evaluation criteria, and the notion that the plan is not a fixed document, but rather a process that evolves in harmony with a changing environment. The final two steps occur at regular intervals by the community with associated adjustments made. The next question is how to develop the data and priorities.
BOSTON
Last week I went to Boston for the American Water Works Association Annual Conference and Exposition. It is a gathering of thousands of water industry professionals – from operators to university professors to engineers to manufacturers. It is a good group of people and most know a number of people each year. The industry is smaller than one things despite there being over 50,000 community water systems in the United States. All are there to network, which allows them to discuss their issue, learn new ways to approach things, create new contacts and see new equipment and techniques. Over 11,000 registered. Good job to AWWA staff and the folks in New England that local hosts.
At the conference, one of many tasks, beyond meetings and education, was to do a class for public officials on what water and sewer utilities are, how they operate, how to deal with revenues and expenses and regulations. The idea is to help local officials understand the complex utility issues which are often second fiddle to more “surficial” activities like parks, and economic development. The officials get a certificate from AWWA for 12 hours of class time, but the fact that these folks come, spend the time, get involved and can then experience the rest of the program is to be commended. I have been doing these public officials classes since my book came out in 2009. The first two days are always based on the book, but the third day can vary depending on issues in the news and preferences form the public officials group within AWWA. This year the focus was operations and revenues. The responses were positive, and the interaction was very good. And I had a blast as well.
It had been 40 years since AWWA was in Boston for ACE. I have been twice previously – once when I was 7 and we went to the aquarium and once to catch a baseball game at Fenway, while on a 5 game, 4 city, 3 day baseball trip. Boston led off. This time, I was able to spend a day looking at the City. Thanks to my friend Chi Ho Sham who acted as chauffer and tour guide – I expect to repay the gesture whenever he can spend a couple days in S. Florida. Boston as many of you know is the cradle of the American revolution, and visits to the old North Church, Paul Revere’s house, the USS Constitution, several cemeteries and Faneuil Hall. Fascinating. Another trip to come as there is much more to experience than a day.
The moral to the story is that conferences allow us to accomplish many things. We meet new people, hear new things, and if we spend a little time, we can experience how others live or have lived. The history is valuable to us personally.
BOOMS AND BUSTS IN RURAL AMERICA
In a prior blog we talked about the difference between urban and rural counties and the impact of the differences between incomes and how that would affect utilities. Keep in mind that the 40 largest urban counties in the US contain nearly half the US population as do the 50 largest utilities. So in a recent article in Governing, the focus was on the few counties where income was higher than average. In fact, in looking at counties, within the top 20 in per capita income are 10 counties in North and South Dakota. Interesting until you review why. All are in areas where fracking is ongoing and corporate farming is prevelant. It is no surprise that the fracking boom has created wealth in rural areas that have limited populations, limited regulations and state and local officials who are desperate to reduce unemployment and stimulate laggard economies. We noted before that rural counties are often desperate for jobs, so they often ignore what could possibly go wrong when jobs and development are the only priorities for a community. Governing used the example of Wells County, ND where the per capita income has doubled since 1997 and is 75% above the national average. Yet the local governments are looking at which roads they will allow to go back to gravel. How is this possible?
The issue is not relegated to just Wells, ND. Despite the fact that many rural communities in areas with intensive farming or fracking have grown 10-15% since 2007, local officials are finding it difficult to raise taxes to pay for infrastructure. Roads are the most obvious and pressing issue because of the impact from fracking traffic. As new wells are constructed, the frackers build new dirt roads and use the existing roadways. Some believe the need to fix many of the roads is temporary so why bother, but it neglects the need to infrastructure improvements in general. The same argument could be used for water and sewer infrastructure as well, but these wealthy rural communities do not want to increase governmental spending to improve any infrastructure, so the opportunity to address the community needs is being lost.
What is more interesting is that the states where these rural counties exist, including the Dakotas, along with Montana, Wyoming, New Mexico, and most of the southeastern states are among the states that rely most heavily on federal funding. So when incomes increase, the dependency remains. These are the same states that tax residents the least, spend the least on education, have the poorest health care (and the fewest people signed up for the Affordable Care Act and few have state exchanges) and have the most people in poverty. The dichotomy between reality and the political perception is interesting in these states, which leads one to wonder if the residents of these states like their situation and keep electing representatives that reflect this desire, or they have fallen victim to political interests that cause them to vote consistently against their better interests, or for the interests of a limited few that deny them access to the education, infrastructure, medical care and other benefits their urban and wealthier neighbors enjoy.
That is a tough question but the bigger question is how to infrastructure agencies like utilities attempt to overcome either of these perceptions? Neglecting infrastructure, education, medical and the like does not promote local economies, does not create jobs and more likely causes the migration of the best and brightest young people out of the community in search of better prospects, which further imperils their rural situation. Keep in mind that most cities are relatively permanent, but fracking, like mining, oil and timber before them, have been booms and busts. The situation if far more dire after the boomtown than it was before. After all, what could possibly go wrong when 50,000 miners, or frackers, descend upon a community of 1,500 people? They will consume all the resources, then leave. Locally those well paying jobs are imported due to the lack of skills and education, and then they leave with the bust. This has played out many times in the past. It is not sustainable. We need to learn from the past – when the boom hits, make the investments you need in infrastructure, education, medicine, etc. so that the future is better after the bust.
Economic Challenges or Challenges to Economics?
As you are aware, I have several hobbies and interest, and economics is one of them. Economics has theorists from many different viewpoints, and the commonality among them is that there is no “school of thought” that explains everything. So new schools get developed to explain the current events, or old ones that were discredits are resuscitated, but unfortunately we too often neglect the past, or at least the examples of the past. Too often the obvious gets ignored. For example, we cave money because we know there will be ups and downs. Individual do it, so why don’t governments? We know that we will pay for a product we need. Demand drives the price. If more people want it, the price goes up. Been that way for…. ever maybe? So in my recent reading I came across several musing that keep getting talked about by political pundits, but may be they are not what they appear to be. So let’s take a look at a couple of these that might just affect us….
Is supply side economics is a myth developed by corporate economists to argue for lower taxes. The concept is to give tax breaks to encourage manufacturers and businesses to produce more product which will reduce costs. You know this is patently false. Try selling your reclaimed water at a discount (or give it away) when it is raining. Demand drives the economy, not supply. Every economics student learns this in economics 101. The supply side economics school developed as a means to explain stagflation in the 1970s. The idea what to give tax cuts to those who invested, so they would invest more to make new products, which would trickle down to the rest of us. Still doesn’t work. Why? What they ignored was that the US industrial sector had saturated the US economy with goods and could not grow without new sectors to sell to. Hence the push on Nixon to open up China to foreign trade and investment. But opening foreign markets was great, except they could not afford our products. So we had to make the products there, increase local wages so they could buy the products, and still shipped products back at a cheaper cost that to build them in America. The idea is not new – recall Henry Ford set up the assembly line to cuts costs to allow him to increase wages so his workers could buy his cars. The obvious question is when we saturate China, then what? Africa? Then what? The economy cannot grow faster than the increase in population. So why does supply side economics keep getting traction? Did we mention those tax cuts….
To the big fashion in Germany and the EU is austerity. Austerity is an economic idea that never seems to die despite very limited success and many, many failures. It sounds great – cut costs and balance the budget while cutting revenues (income). Ok, so let’s see how that works in your household – you quit your middle class job and take a minimum wage job. You cut your expenses. Except you can’t sell your house without a loss (and you do not have the cash to make up the difference) and you need your car to get to your new job. But austerity says that if you eat rice, beans, cereal and Ramen noodles, you will soon be far better off than you are now. No one will suffer. Do you believe it? Do you wonder why the Greeks and Irish are not doing so well today and why people are restless? They used to devalue their currency, but the Euro prevents this. They do not have away out. Meanwhile Iceland devalued currency, let the banks fail, took over the bank assets, and are doing much better. Austerity was not the option…. Just saying… And who suffers the most? Not the high income folks.
Tax cuts stimulate the economy. Sounds great. But, from 1944 to 1963, the income tax rate on the highest earning bracket in 1960 was 90% over $200,000. Yes 90%! The economy was great. The middle class was born. House ownerships jumped. Education was up. The economy in the 1970s stagnated after we cut tax rates. We cut the income tax rate in the 1980s, but raised other taxes, and things improved, but then declined. The economy improved after the Bush tax hike in 1991. It did not improve after the Bush tax cuts in 2001. Interesting in their book Presimetrics, Mike Kimel and Mike Kanell noted that higher taxes seem to correlate with a better economy. Is it because investors can’t sell stock so easily when they made a profit so corporations can count of investments longer? Or is it that the increase in revenues allows the federal government to invest in more research and development that further stimulates the economy? Did we mention the tax cuts favor the wealthy?
The moral of the story is that utility managers cannot ignore the economic realities around them. We cannot be trapped by the musings of people who have hidden agendas, which means that our understanding of the way things are must extend beyond the utility itself. The economy, economics, monetary policy, tax policy, demographics and change are areas that utility managers need to be current on. Engineers and managers often understand these issues easily (most are mathematical) but we tend to focus only in out areas. We need to become educated. Recall the earlier blog where I noted the city manager who realized later that the reason elected officials tended to bad alternatives was they were being lobbied to approve the poorer options because their clients could make money from it. You know many ideas that will be lobbied to elected officials and business people in the future. You need to become educated on these ideas and how they affect your utility. You know that rates that are too low will not increase revenues. You know you need to expand sales when possible, perhaps serving new areas, and making the investments for same. You know that not spending money will only increase the risk of failure in the system. You know that not increasing pay will disenfranchise employees. Prepare for these assaults so you can lead your utility down the proper path.
THE SHRINKING MIDDLE CLASS
In the last blog I commented on the Donald Sterling, Thomas Sowell and Clive Bundy comments the week before. I wonder if letting the hate out just a way to keep us from looking at the bigger picture from a political (and maybe business) perspective? And should utilities we concerned? The answers may be yes, and yes an dhere is why. An August 2012 Pew Research Center report noted that only half of American households are middle-income, down from 61 percent in the 1970s. The shift was downward, not upward as the very rich (0.1%) control 58% of the wealth in the US. In addition, median middle-class income decreased by 5 percent in the last decade, while total wealth dropped 28 percent. The need for social programs, despite cutbacks and revisions to the welfare programs in the Clinton era, have increased – since 2000 Medicaid has increased from 34 million people to 54 million in 2011 and the Supplemental Nutrition Assistance Program (SNAP, or food stamps) from 17 million to 45 million in 2011. Keep in mind that income drives qualification for these services so it means that incomes are down for millions in America. The increase in people needing help is no surprise since there is an ongoing increase in the number of lower-wage service jobs like food preparation, retail and service industry, but the number of middle-class occupations, like teaching and construction, have declined. Since 2010, the State of Florida has added 400,000 jobs, impressive except that the vast majority are service and retail jobs that pay just above minimum wage. The job growth in low wage jobs does not replace the loss of middle income jobs which is why 47% of households did not earn enough to pay income tax in 2103. It is not because they don’t want to, it’s because they don’t get paid enough. And we have tens of millions of these low wage jobs that don’t pay enough for the recipients to pay taxes. Just the opposite of what some of the political discussion would have you believe.
The loss of wages is felt locally more than nationally. It means that local officials hear about costs more because water, sewer, power, etc competes for an ever larger portion of the shrinking paycheck. So we see more attention paid to affordability indexes, the ability to pay. The concept of affordability is to take your annual water and sewer bill and divide it by the average or median local income. The goal is water plus wastewater is under 3.5% of the median income. Keeping the percent low is great and easy when people are making more money, but creates a lot of difficulty when the incomes are static or dropping. An our costs are rising due to the increasing need to maintain and upgrade infrastructure that has been neglected since 1980 (the annual investment is under 1.4% for most of the US infrastructure for the last 30 years. We need to invest above 2.3% to keep up according to GAO).
When income drop, costs become more important, and local water and sewer costs are often easier targets to limit than groceries, rent, power, telephone, cable or other services that are not subject to local official votes. So it is in all of our interests to work with local officials, colleges, vocational schools, public schools et al. to attract or build a economy that features higher income jobs, to get everyone employed, and to provide training, infrastructure, outreach, health care and other help to establish a competent, highly skilled workforce in a community. That means that utilities must support the local efforts to effect social change in the community, to help meet the needs of residents not just with water, but with respect to the local economy as well. Does that mean we are actually agents for social change?
Leadership Survey – Your response appreciated
Good Day! There are over 350 people that receive this blog via WordPress, Linked and Facebook. Thank you. .
So I want to let you know about a project I am working on to develop some measures to identify leadership perceptions in the industry. So we have created an online survey that I would like to have you participate in. It should take no more than 10 minutes of your time, but will help us formulate a larger survey of the industry. I would love to get 100 responses. I will report the results. Your help is appreciated.
Go To : https://www.surveymonkey.com/s/6BFDMRQ
Top Ten Reasons to Deny Climate Change is Occurring in no Particular Order
borrowing for infrastructure, Climate, Development loans, economy, engineering, Environment, finance, funding, infrastructure, innovation, Leadership, local government, management, planning, Revenues, sea level rise, stormwater, Transportation, utilities, Water Funding, water sewer management, water supplies, Water treatment
I had to share this, from a nonscientific survey of people adamantly opposed to any consideration of changes to our climate:
1. I can’t do anything about it so I don’t care about it
2. People can’t alter what is happening with the earth because it is too big
3. It’s natural, so we can’t do anything about it
4. It’s not an issue now, so it’s somebody else’s future problem
5. The science is inconclusive so why do anything yet. Let’s see what happens
6. Trying to address it will cut jobs
7. We won’t be competitive (i.e our profits will drop)
8. It requires changing our business model (energy)
9. If we talk about it no one will develop in our community
10. Costs too much
I had to post this as many of you will have comments. But before you do, these about this a minute……
The first five are based on no facts, but a desire to ignore the issue entirely. The second five are more poignant because aren’t these pretty much the same arguments to deny the need to correct water pollution concerns in the 1930s? Or 1950s? Or even 1970s? Or even today with hog farms, frack water, acid mine waste, coal dust slurries, etc.? Or actually pretty much every regulation? I seem to recall Tom Delay making this argument when he was in Congress before he was indicted.
Now think about the Clean Water Act, Clean Air Act, Safe Drinking Water Act, and others. These regulations are designed to correct ills of the past that were simply ignored due to the first five arguments above, ignoring the fact that prevention is always less costly than cleanup afterward. To we pass regulations to clean up problems and protect the public health going forward. Otherwise why have a regulation?
So let’s talk about that jobs impact. The reason is that after the passage of these regulations, didn’t the number of professional jobs (like civil and environmental engineers, environmental and other scientists – STEM jobs) increase? Isn’t increasing STEM jobs a priority? So won’t dealing with climate issue perhaps create a similar increase in STEM jobs? Yes, costs for water increased and the cost for the effects of climate changes will cost money, but don’t these challenges create opportunities? Isn’t this akin to dealing with problems with development from the past? Just asking…..
Fracking and Water – Do They Mix?
Let’s start with the basic premise of this conversation – fracking is here to stay! It doesn’t matter how many petitions you get in the mail, fracking is going to continue because the potential for gas production from fracking and the potential to fundamentally change our energy future, near or long-term, far outweighs the risk or economic and security disruptions from abandoning fracking efforts. It looks like there is a lot of trapped gas, even if the well exponentially decay production in the first three years, although many well can be recovered by refracking. It is an issue that residents and utilities need to accept. The question is really how to assess the risks to water supplies from fracking and what is what can we do about it?
There are a number of immediate regulatory issues that should be pursued, none of which Vikram Rao (2010) suggests are truly deal killers. They start with the disclosure of the fracking fluids, which for most legitimate companies that are fracking are relatively benign (and do not include diesel fuel). Baseline and ongoing monitoring of formations above the extraction zones, and especially in water production zones is needed. Research on water quality treatment solutions is needed because t may be impossible to completely eliminate escaping gas is needed. Requirements to improve and verify well construction and cementing of formation is needed in all states (they are not now) and recycling frack water and brine should be pursued to avoid impacts on streams and wastewater plants, which limits the loss of water due to fracking operation and the potential for contamination of surface water bodies. It will be important to push for these types of regulations in states like Ohio and West Virginia that need jobs and are likely places for fracking to occur, but they are also likely places where there will be political pushback that is afraid of discouraging job investments, but in reality this is unfounded. The gas is there, so the fracking will follow. The question is will the states implement needed regulations to protect the public.
More interesting will be the ancillary issues associated with gas and wet gas. A lot of by products come from wet gas, like polyethylene which can be used as stock for a host of plastics. “Crakers” are chemical processing plants that are needed to separate the methane and other products. Where will those facilities be located, is an issue. Right now they are on the Gulf coast, which does not help the Midwest. Do we really need to ship the gas to Louisiana for processing or do we locate facilities where the gas and byproducts are needed (in the Midwest)? The Midwest is a prime candidate for cracker location, which will create both jobs as well as potential exports. Also stripping the gas impurities like ethane, DEM and others needs to occur.
So what do utilities need to look at the potential impacts on their water supplies and monitor. If the states will not make the fracking industry do it, we need to. Finding a problem from fracking after the fact is not helpful. We need to look at potential competition for water supplies, which is in part why recycling frack water brine is needed. Eliminating highly salty brine from going to a treatment plant or a water supply are imperatives. Sharing solutions to help treat some of these wastes may be useful – something we can help the industry with is treating water.
We also need to look at the processing plants. We need to be looking at the impact of these facilities in light of water and sewer demands (and limitations). Wet gas facilities will require water as will plastics and chemical plants. Historically a lot of these facilities were in the Midwest and the research and skill sets may still be present. How can these industries can be merged into current water/sewer scenarios without adverse impacts. Communities will compete for these facilities, but good decisions may dictate that vying is not the best way to locate a plant.
But there is another impact to utilities and that affects green technologies. The cost of gas is low and looks like it will remain low in the near future. Low gas prices mean that renewable solutions like solar and wind will be less attractive, especially if federal subsidies disappear. Wind is the largest addition to the power generation profile in the last 5 years, while many oil facilities changed to gas. Cheap gas may frustrate efforts to create distributed power options at water and wastewater treatment plants throughout the country which can directly benefit utilities, not just where fracking occurs. So we need to be cognizant of these cost issues as well. And you thought the fracking discussion might not affect you….
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