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Bernie Sanders wants a $15 minimum wage law.  Voters in Seattle have agreed.  Starbucks and a variety of others companies have acted.  The change is great for the many low wage earners who struggle to get by working multiple part-time, minimum wage jobs.  Low wages are a drain on the talents of society who struggle with juggling food, medicine, education, shelter and other costs while supporting families. Since 1980, the actual wage rates, when adjusted for inflation, have fallen form many people, shrinking the middle class and expanding the number of economically challenged.  Economic challenges lead directly to social, and health vulnerability.  If you want to cut medical costs, increase the standard of living for people at the lower income levels. You want to sell more stuff, create more disposable income for people to spend across all income levels, not just at the top.   Ditto if you want to have less debt, and more savings.  That is what the intent was in the 1960s under the reforms of the “Great Society.”   Progress started, then 1980 showed up and many reforms were reversed before the trends could really show.  Not that those 1960s ideas were perfect, but clearly the last 30 years has shown the reversal is not unless you are among the 0.1%.

As an example, back in the day, fast food restaurants were the purview of students, not twenty and thirty something adults and grandma.  These were low income jobs, and have remained so.  The intent was not to make these jobs “permanent.”  But they have become jobs for adults.  Back in the day there were more workers, more customer service and more food prep.  Over the years, though, ingredients started to arrive packaged and pre-mixed, so that the only labor was to heat it up, bag it and hand it out the window.  Fast food is now packaged at factories in mass production which requires less labor. Less jobs, same low pay. Gas station attendants were also commonly kids, who washed your windows, checked your oil and pumped your gas (no, really they did!).  They got paid minimum wage as well. Not anymore – that was too costly and got cut.  The list goes on.  Customer service is apparently only important if you are trying  to attract customers.

So now more adults are in these industries, and many must work multiple jobs to make ends meet.  So a higher wage is welcome news.  Or is it?  Let’s see what happens when the wage doubles up without increased growth.  Well, the gas station attendants that used to pump gas were replaced with computers.  You even have gas stations that are completely automated – no people!.  You have computers putting in orders now at restaurants.  About 30 percent of the restaurant industry’s costs come from salaries, so could burger-flipping robots and computer ordering system like some restaurants already employ, become more cost-competitive and may displace more workers if the current federal minimum wage of $7.25 an hour is doubled.  At risk are 2.4 million wait staffers, 3 million cooks and food preparers and 3.3 million cashiers.

So where will we see this?  Electronic menus can be constantly updated so that items that are out of stock can be removed. Connecting the point of the sale to the oven’s operating system allows precise amounts of food to be cooked, which helps cut down on costs. Other inventions save energy, reduce maintenance and better dispose of grease. On the digital side, restaurants are working on apps that include reward systems and location tracking that prompt customers to eat with them more frequently. Olive Garden said earlier this year that it would roll out the Ziosk system at all its restaurants, which means that all a server has to do is bring out the food.  The employees would be reduced to fixing things when they break.  That could be a lot less employment.

Corporations have a priority to make money, which can mean cutting costs and becoming more efficient.  Bottom line profits are king, not people. See GM, VW and others who ignored defects in their products, preferring to pay the costs of the lawsuits as opposed to fixing the defect.   So the $15 minimum wage will be cheered by those making less, but jeered by low margin corporations that will be forced to raise prices and become more efficient.  Too often those changes do not include paying people – at least in this country.  The winner will be……. to soon to tell, but I won’t bet against the corporations.


Most states were doing pretty well before the 2008 recession hit, but that ended in 2009. Most states had to make extremely difficult cuts or raise taxes, which was politically unacceptable. Of course invested pension systems received a lot of attention as their value dropped and long term sufficiency deteriorated, which was fodder for many changes in pensions, albeit not how they were invested. The good news is a lot of them came back in the ensuing 5 years, but 2015 may be different. A number of states have reported low earnings in 2015 and whether this may be the start of another recession. The U.S. economy has averaged a recession every six years since WWII and it has been almost seven years since the last contraction. With China devaluing their currency, this may upset the economic engine. At present there are analysts on Wall Street who suggest that some stocks may be overvalued, just like in 1999. If so, that does not bode well states like Illinois, Kansas, New Jersey, Louisiana, Alaska and Pennsylvania that are dealing with significant imbalances between their expenses and incomes. Alaska has most of its revenue tied to oil, so when oil prices go down (good for most of us), it is a huge problem for Alaska that gives $2200 to every citizen in the state. An economic downturn portends poorly for the no tax, pro-business experiment in Kansas that has been unsuccessful in attracting the large influx of new businesses, or even expansion of current ones. California and next door Missouri, often chided by Kansas lawmakers as how not to do business, outperform Kansas.

Ultimately the issue that lawmakers must face at the state and as a result the local level is that tax rates may not be high enough to generate the funds needed to operate government and protect the states against economic down turns. There is a “sweet spot” where funds are enough, to deal with short and long term needs, but starving government come back to haunt these same policy makers when the economy dips.   It would be a difficult day for a state to declare bankruptcy because lawmakers refuse to raise taxes and fees.


Your grandma always told you to save money for a rainy day.  She wasn’t really talking about rainy days, but days when you had less or no income.  The press talks about the huge percentage of Americans that have little or no savings, and how compared to other countries, we are at a disadvantage during economic times.  A huge problem is that the same argument can be translated to governments, which must provide services, and often more services during economic downturns.  But if they have no savings, how are they to accomplish this?  They do not want to raise taxes and fees in down situations, so won’t the loss of services just make things worse?

A recent PEW reports suggests that states “had about half the reserves necessary to address budget gaps during the first year of the Great Recession.  The 50 states had about $60 billion set aside in the summer of 2008, but in fiscal 2009, budget gaps across the country totaled $117 billion, about twice what states had in reserve. The budget gaps continued to grow in 2010 and many states struggled with shortfalls for years afterward.  Bad news, but the news really does not improve.  They report that 37 states have legal caps that prevent them from saving enough to weather recessions or even enough to substantially offset revenue losses, and most of those are based on some percentage of the prior year’s revenues.  Why?  Short-term views?  Most governments figure on keeping enough cash on hand to pay bills during tax seasons. That accounts for 60-90 days of funds.  Far too little for dealing with economic impacts.  Far too few state governments recognize the importance of saving, figuring that cutting taxes during time of plenty and giving back to taxpayers is a better use of funds.  Then it is someone else’s issue when the next economic hiccup occurs – and it will.  Unless you raise your cap now as Minnesota and Virginia have recently done.

But the issue is not just a state issue.  It is a local and a utility issue as well.  Local governments are closer to the ground, have less leeway in their budgets and often have far too little funding as a result of resistance to raising property taxes, user fees and over-dependence on state shared sales tax, which often drops precipitously during a recession.  Same goes for sin and gas tax dependence.  When people slow smoking, or as oil prices drop, so do revenues.  Ask Alaska, Louisiana, Kansas, Texas, North Dakota and others that are oil rich states about their budget this past year.  The legislatures were begging Grover Norquist to let them out of their no tax increase pledges.  He said no of course, because he doesn’t want government to function properly.  So those legislators were stuck in the either “do the right thing” or “get whacked by Grover in the next election” conundrum.  You know what they did because they want to get re-elected  That doesn’t help the citizens of those states.  Standard & Poor’s revised its outlook on Alaska’s general obligation and appropriation-backed debt from stable to negative. That will cost them in the future. St. Louis, Moody’s downgraded the city’s credit rating one step to A1, citing “the city’s weak socioeconomic profile; reliance on earnings taxes which are due for voter reauthorization in 2016.”  Diversity in industry and taxes is beneficial.  Too often this gets lost in the desire to do more with less, but doing more means you need more funding!  And you need to collect those savings as grandma counselled!


I have a friend in south Florida who is a lawyer who is starting the conversation about farmland for sale.  Ok, in south Florida is might be about 40 years too late, but he has a great argument to make, even here, now.  Developers have paid handsomely for agricultural land near urban areas, especially in areas with nice weather (see Florida).  The problem is that many of those lands have been productive and because they are close to urban areas, convenient for the movement or produce to feed those communities or export the food to other areas.  It would seem obvious that buying food locally would be preferred to buying food from far away, unless you are an Agribusiness or developer that is.  And most family farms have been handed down to generations that, well, just don’t want to work farms, given the amount of money that the land can be sold for.  So it is an easy economic argument to make – sell your farm to developers and live happily ever after.  Except that means farmland that is no longer producing.  And as my friend notes, there is a finite amount of farmland out there and we are decreasing that acreage in the US every year.

Now true, some will argue than development is less water intensive than farms, but much of that argument is due to the traditional practices used for farm watering, as opposed to newer, less wasteful means.  So they argue, development is preferable to farming, but that argument may be limited to areas that are a) water poor  b) bring water in from elsewhere, c) extensively use groundwater which may not recharge, or d) should probably have neither farming or development.  But is Florida, we see fewer oranges, fewer row crops and less ranching than 20 or 40 years ago.  All that land is condos and houses, and our food gets trucked or shipped in from many places, a lot of them not Florida and few local.  He suggests that might not be a good thing for the long term.

Of course Florida is going to be faced with another of these land dilemmas.  When Crist was governor, he negotiated a deal to buy land from US Sugar to help restore water from Lake Okeechobee to the Everglades.  Now the powers say they can’t afford to maintain the land, so US Sugar can keep it.  Of course US Sugar has plans for 100,000 houses in the Everglades Agricultural Area, or more, once farming stops.  I see my friend cringing.  That land, while not beneficial as farmland, surely would be less beneficial and farm more vulnerable as development.  Maybe we should rethink that land purchase?  Worth thinking about anyway.


In an interesting twist of fate, USEPA caused a spill on the Animas River when a staffer accidently breached a dike holding back a solution of heavy metals at the Gold King mine because the misjudged the pressure behind the dike.  Pressure?  The spill flowed at 500 gpm (0.7 MGD), spilling yellow water spilled into the river.  Downstream, the plume has travelled through parts of Colorado, New Mexico and Utah, and will ultimately hit Lake Mead.  Officials, residents, and farmers are outraged.  People were told not to drink the water because the yellow water carried at least 200 times more arsenic and 3,500 times more lead than is considered safe for drinking. The conspiracy theorists are out.  The pictures are otherworldly.

colorado-mine-spillRayna Willhite holds a bottle of water she collected form the Animas River north of Durango Colo., on Thursday, August 6th, 2015. About a million gallons of toxic mine waste emptied out of the Gold King Mine north of Silverton that eventually made it into the Animas River. (Jerry McBride/Durango Herald via AP)

0807 colo spill epa-spill-

But they are all missing the point, and the problem.  This is one of hundreds of “legacy disasters” waiting to happen.  We are just surprised when they actually do.  A legacy disaster is one that is predicated on events that have happened in the past, that can impact the future.  In some cases the far past.  There are two big ones that linger over communities all over the west and the southeast – mines and coal.  Now don’t get me wrong, we have used coal and needed metals form mines.  That’s ok.  But the problem is no one has dealt with the effects of mining or coal ash for many years.  And then people are upset.  Why?  We can expect these issues to happen.

One major problem is that both are often located adjacent to or uphill from rivers.  That’s a disaster waiting to happen.  The King Gold mine is just the latest.  We had recent coal ash spills in Kingston, Tennessee (TVA, 2008) and the Dan River in 2014 (Duke Power). The Dan River spill was 30-40,000 tons.  Kingston cleanup has exceeded a billion dollars.  Coal ash is still stored at both places.  Next to rivers.  We had the federal government build ion exchange facilities in Leadville, CO and Idaho Springs, CO to deal with leaking water from mine tailings from the mountains. Examples are in the hundreds.  The photos are of the two coal spills, mine tailings that have been sitting the ground for 140 years in Leadville and one of the stormwater ponds – water is red in Leadville, not yellow.

kingston_coalash POLLUTE-master675 IMG_4803 IMG_6527 (2015_03_08 17_53_48 UTC)

When the disaster does occur, the federal government ends up fixing it, as opposed those responsible who are usually long gone or suddenly bankrupt, so it is no surprise that EPA and other regulatory folks are often very skeptical of mining operations, especially when large amounts of water are involved.  We can predict that a problem will happen, so expensive measures are often required to treat the waste and minimize the potential for damage from spills.  That costs money, but creates jobs.

For those long gone or bankrupt problems, Congress passed the Superfund legislation 40 years ago to provide cleanup funds.  But Congress deleted funding for the program in the early 2000s because they did not want to continue taxing the business community (mines, power plants, etc.).  So EPA uses ARRA funds from 2009.  And funding is down from historical levels, which makes some businesses and local communities happy.  The spectre of Superfund often impacts potential developers and buyers who are concerned about impacts to future residents.  We all remember Love Canals and Erin Brockovich.  Lack of development is “bad.”  They ignore the thousands or jobs and $31 billion in annual economic activity that cleanup creates, but it all about perception.

But squabbling about Superfund ignores the problem.  We continue to stockpile coal ash near rivers and have legacy mine problems.  Instead we should be asking different questions:

WHY are these sites permitted to store ash, tailings, and liquids near water bodies in the first place?  EPA would not be inspecting them if the wastes were not there.

WHY aren’t the current operators of these mines and power plants required to treat and remove the wastes immediately like wastewater operators do?  You cannot have millions of gallons of water, or tons of coal ash appear overnight on a site, which means these potential disasters are allowed to fester for long periods of time.  Coal ash is years.  Mine tailings… well, sometimes hundreds of years.

One resident on the news was reported to have said “Something should be done, something should be done to those who are responsible!”  Let’s start with not storing materials on site, next to rivers.  Let’s get the waste off site immediately and disposed of in a safe manner.  Let’s recover the metals.  Let’s start with Gold King mine.  Or Duke Power.  Or TVA.


This month’s Journal for AWWA has several articles devoted to direct potable reuse (DPR).  Total Water Solutions is the moniker that AWWA has tapped lately as the organization has moved to the message that water sources cannot be separated.  California believes that 40% of its urban water use can be recycled to direct potable reuse, which can address a lot of the drought concerns for urban users (11% of California’s water use).  The technology is available to make DPR a reality.  The concerns involve insuring system reliability (i.e. redundancy in processes), and public perception of DPR.  As I noted in a prior blog, there are two cities in Texas already doing DPR.  There are several places in California doing indirect potable reuse (IPR) which basically involves injected the water into an aquifer or releasing it in an upstream reservoir.  The treatment is basically the same for both but the separation is creates a different public opinion. One that is not so different than discharging wastewater to rivers that serve as water supplies downstream.  Both IPR and DPR were unheard of as ideas outside southern California until more recently.  But in the past several years, both have seen a significant change in Texas, California and Florida.  Water-logged south Florida has looked at 5 IPR projects in the past 7 years, and has a couple reuse ASR systems.  Should drought conditions return, these projects may not be so far-out (note we are at 25% normal rainfall in southeast Florida – but water use is 10% below 2005 levels).


Over the past couple weeks I have been at two conferences and had two interesting conversations.  The first one was in Anaheim at the AWWA Annual Conference and Exposition.  The subject was the organization Engineers Without Borders (EWB).  The organization has the mission to help get drinkable water to people in undeveloped parts of the world.  Nearly two billion people do not have clean drinking water which drastically impacts their health and ability to be productive and earn a living.  Many of these people live in Africa and Asia; some in central and South America as well.  The mission is a noble one – to help people.  But the guy I was talking to raised an interesting question – if we help all these people get water, they will demand more resources and if the resources are already limited, won’t creating more demands for those resources compromise our access and cost to those services?  Hence helping them actually creates competition with us for the same resources and that can compromise our goals.  Clearly not a fan of EWB, but, an interesting take on the issue..…

The second conversation was a few days later when a group of people were talking politics.  The conversation inevitably ended up on political parties and people and service organizations like Engineers Without Borders that are often viewed as being ”liberal” or “progressive” as opposed to “conservative.”  The discussion got around to this question – would conservative groups give money to progressive groups like EWB?  The answer was a resounding yes, because that would improve conditions which would make people more productive, which means more jobs, and more income to give more people access to buy more things, which creates a demand for more things, which expands the economy.  In other words, increase profits for those folks building the “things.”  Interesting twist, and you thought is was all about water….


We are all aware of the major drought issues in California this year – it has been building for a couple years.  The situation is difficult and of course the hope is rain, but California was a desert before the big water projects on the 1920s and 30s. Los Angeles gets 12 inches of rain, seasonally, so could never support 20 million people without those projects.  The central valley floor has fallen over 8 feet in places due to groundwater withdrawals. Those will never come back to levels of 100 years ago because the change in land surface has collapsed the aquifer. But the warm weather and groundwater has permitted us to develop the Central Valley to feed the nation and world with produce grown in the desert.  The development in the desert reminds me of a comment I saw in an interview with Floyd Dominy (I think), BOR Commissioner who said his vision was to open the west for more people and farming, and oversaw lots of projects to bring water to where there was none (Arizona, Utah). The problem is that the west never head much agriculture or population because it was hot, dry and unpredictable – hence periodic droughts should be no surprise – the reason they are a surprise is that we have developed the deserts far beyond their capacity through imported water and groundwater.  Neither may be reliable in the long run and disruptions are, well, disruptive.  Archaeologist Bryan Fagan traced the fall of Native American tribes in Arizona to water deficits 1000 years ago.

Yet policymakers have realized that civil engineers have the ability to change the course of nature, at least temporarily, as we have in the west, south, Florida. I often say that the 8th and 9th wonders of the world are getting water to LA over the mountains and draining the southern half the state of Florida. I have lived in S. Florida for 25+ years and am very familiar with our system. The difference though is that we have the surficial Biscayne aquifer and a rainy season that dumps 40 inches of rain on us and LA doesn’t (as a note of caution, for the moment we are 14 inches below normal in South Florida – expect the next drought discussion to ensue down here in the fall). The biggest problems with the Everglades re-plumbing are that 1) no one asked about unintended consequences – the assumption was all swamps are bad, neglecting impacts of the ecosystem, water storage, water purification in the swamp, control of feedwater to Florida Bay fisheries, ….. 2) one of those unintended consequences is that the recharge area for the Biscayne aquifer is the Everglades. So less water out there = less water supply along the coast for 6 million people 3) we lowered the aquifer 4-6 ft along the coastal ridge, meaning we let saltwater migrate inland and contaminate coastal wellfields 4) we still have not figured out how to store any of that clean water – billions o gallons go offshore every day because managing Lake Okeechobee and the upper Everglades was made much more difficult when the Everglades Agricultural Area was established on the south side of Lake Okeechobee, which means lots of nutrients in the upper Everglades, and a lack of place for the lake to overflow, which meant dikes, more canals, etc. to deal with lake levels.

The good news is that people only use 11% of the water in California and Florida, and that Orange County, CA and others have shown a path to some degree of sustainability (minus desal), but the real problem is water for crops and the belief that communities need to grow. When we do water intensive activities like agriculture or housing, in places where it should not be, it should be obvious that we are at risk. Ultimately the big issue it this – no policy makers are willing to say there is “no more water. You cannot grow anymore and we are not going to send all that water to Ag.”  Otherwise, the temporary part of changing nature will come back to haunt us.


As technology advances I have an observation, and a question that needs to be asked and answered.  And this could be a pretty interesting question.  Back in the day, say 100 or 150 years ago, there were not so many people.  Many activities occurred where there were few people and impacts on others were minimal.  In some cases ecological damage was significant, but we were not so worried about that because few people were impacted by that ecological damage.  In the 20th century, in urban locations, the impact of one’s activities on others became the basis for zoning laws – limiting what you could do with your property because certain activities negatively impacted others.  And we certainly had examples of this – Cuyahoga River burning for one.  Of course this phenomenon of zoning and similar restrictions was mostly an urban issue because there potential to impact others was more relevant in urban areas.  We also know that major advances in technology and human development tend to occur in population centers (think Detroit for cars, Pittsburgh and Cleveland for steel, Silicon Valley, etc.).  People with ideas tend to migrate to urban areas, increasing the number of people and the proximity to each other.  Universities, research institutions, and the like tend to grow up around these industries, further increasing the draw of talent to urban areas.  The observation is that urban areas tend to have more restrictions on what people do than rural areas.  So the question – do people consciously make the migration to urban areas realizing that the migration for the potential financial gain occur with the quid pro quo of curbing certain freedoms to do as you please?  Of does this artifact occur once they locate to the urban areas?  And is there a lack of understanding of the need to adjust certain activities understood by the rural community, or does it become yet another point of philosophical or political contention?  I have blogged previously about the difference between rural and urban populations and how that may affect the approach of utilities, but read a recent article that suggests that maybe urban citizens accept that financial gains potential of urban areas outweighs the need to limit certain abilities to do as you please to better the entire community.  They are motivated by potential financial opportunities that will increase their standing and options in the future.  So does that mean urban dwellers understand the financial tradeoff differently than rural users?  Or is it a preference issue.  And how does this translate to providing services like water to rural customers, who often appear to be more resistant to spending funds for improvements?  While in part their resistance may be that their incomes tend to be lower, but is their community benefit concern less – i.e. they value their ability to do as they please more than financial opportunities or the community good?  I have no answer, but suggest that this needs some further study since the implications may be significant as rural water systems start to approach their life cycle end.


The true risk to the community of pipe damage is underestimated and the potential for economic disruption increases.  The question is how do we lead our customers to investing in their/our future?  That is the question as the next 20 years play out. Making useful assumptions about increases in demands, prices, inflation rates etc. are key to useful projections and long-term sustainability. Building too much or too little capacity for example can have disastrous consequences (to the ratepayers on the former, to the local economy for the latter).

Getting funding relies on economic strength, a problem of you are in a depressed area (Detroit) or a boom that could crash at any time (North Dakota).  P3 opportunities are available for cash strapped communities but they come with a cost.  Risk must be allocated fairly – the private community will not take on too much risk without increasing costs significantly. Loss of control is one of those risk conversion issues.  Extensive planning and feasibility analyses should be expected – far more scrutiny than most utilities are used to.  The economic strength of the community is important to private investors.

In a prior blog we talked about the boom towns of North Dakota.  Things were booming in 2013 but the downturn in oil prices may get ugly.  The need for more fracking wells may have decreased (at least temporarily) and the decrease in the oil and gas costs has cut into local revenues, so is this is the time to keep planning for the boom?  South Florida did this in the early 2000s – and well, that real estate boom put quite a dent in the economy and population estimates for 2020 and 2030.  The balloon popped and so did the economy.  South Florida had the resiliency to bounce back because of weather and proximity to South America.  We have seen the result to an industrial economy – where a community relies on industry, well industry can be fickle.  Ask Detroit.  Or Cleveland.  Or any number of other Rust Belt cities.  Now they have infrastructure, but much of it is underused.
So while the Plains states plan for the boom, the boom has settled in some places. Already the oil and gas industry has shed 100,000 jobs (many high salary).  Texas, Kansas, North Dakota and Oklahoma are facing financial challenges in 2015 due to funding losses.  Alaska is dipping into reserves.  But that doesn’t mean the results of the 2010-2014 boom are not continuing, or at least portions of them.  Frack water continues to be discharged to local wastewater systems, but the revenues to pay for the needed upgrades is lacking.  Effluent limits for nitrogen and TOC for some rivers have decreased as a result of constant increased loading to the streams (more flow increases total loads, so if flows remain the same, the concentrations must decrease to maintain total loading).  The costs to reduce ammonia, for example from 10 mg/l to 2 or 3 mg/L can be $1-2/1000 gallon – over 50% or more of the current cost for treatment.

So is it a surprise that some communities fight the boom times?  Booms create disruption and uncertainly, and a need for technology (and costs).  Maybe stability does matter, as it can contain costs and treatment requirements.  However the boom can help communities in financial distress.  Detroit and Flint would love a boom – both have the infrastructure in place to support it as opposed to rural communities in the Plains.  But that’s is a key – they already HAVE the infrastructure in place.  The Plains, well, do not.

There is a lot of older, underutilized infrastructure out there.  Detroit, Flint, Cleveland, Akron, Toledo and Philadelphia are among the older industrial cities that have stable populations – people that live there most of their lives, have a trained and educated workforce, and normally have lots of water and infrastructure, and lots of potential employees, all of which are underutilized and at risk due to economic losses. But the booms rarely go to older cities. How that is?  Is this a leadership issue?  Convenience?  Quick profits?  And how long will the boom last?  Is it a matter of lack of understanding or regulations that creates the boom?  A combination of factors?  A better PR program?

Remember we all play defense.  Industry does not.  Industry plays offense all the time.  The private sector mode is play offense.  Get the message out.  Frame the message.  Win the game.  Is winning the game at any cost the right answer?  For boomers it is.  What about the rest of us?

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