In the absence of immediate funding solutions, the Obama Administration takes some important initial steps to break down planning barriers between federal agencies responsible for infrastructure related programs—Departments of Transportation, Housing and Urban Development and Energy, and the Environmental Protection Agency. This more concerted policymaking approach could lead to developing national and regional strategies for helping America’s primary metropolitan areas cope with urbanizing suburbs, traffic congestion, and aging or inadequate water, sewer, and power systems. But more needs to be done.

Infrastructure 2010 recommends government officials and policy experts join together to take effective action, including:

• Level with the American people about how the country is falling behind other economies as a result of under-investing in infrastructure, and explain the true costs of making required upgrades and building new systems.
• Determine a national vision for infrastructure improvements which supports the viability of the nation’s key metropolitan areas and national gateways—the places which increasingly concentrate economic activity and propel growth.
• Move towards merit rather than formulas in allocating federal funding to state and local governments for infrastructure, and encourage integrated infrastructure, environment, and land use planning. Establish a National Infrastructure Bank, modeled on Europe’s success, which can help promote more investment-grade decision making and attract more private capital into infrastructure investments.
• Raise revenues through user fees, not only to pay for improvements and upgrades, but also to help gain economic efficiencies and environmental benefits through encouraging changed behaviors—less driving, greater water conservation, and reduced per capita energy consumption.

Addressing the Water Challenge
While transportation related issues and energy needs typically dominate infrastructure agendas, ensuring water availability and maintaining water quality also require immediate attention to manage supply and demand. No one can take water for granted. Every U.S. region—including fast growing metropolitan areas in arid Western states and established cities in more fertile zones—faces costly challenges to husband and deliver this precious and essential resource. Federal and state governments must consider how to allocate supplies among competing users--residential, industry, and agri-business--as the impacts of climate change and increasing population accelerate the urgency of dealing with the water challenge.

Revamped approaches and implementing solutions are necessary, including:

• Repair and modernization of outmoded systems--reduce leaks in water delivery networks and stem declines in water quality from failing sewage treatment plants.
• Developing collaborative regional strategies to protect supplies across multiple states and varied local jurisdictions.
• Employing proven land use techniques to reduce storm water runoff and capture ground water to replenish depleted aquifers.
• Using innovative recycling technologies in development projects and for retrofitting existing buildings.
• Farming less-water-intensive crops and planting less water-dependent landscaping.
• Implementing conservation-oriented irrigation systems.

Internationally, few countries escape water-related challenges. Australia implements innovative adaptation and conservation schemes to deal with parching drought. Many European countries fail to provide reliable water quality, India struggles with inadequate systems, and China copes with contamination and pollution in its water supplies, the result of its breakneck industrialization pace.

Changing How We Pay
How to pay for infrastructure remains a daunting quandary for most countries, particularly the United States, where decades of underfunding now forces massive catch-up by deficit-constrained federal, state and local governments. Unfortunately, political will appears in especially short supply to tackle mounting problems as cash-strapped households and businesses could buckle under higher taxes. Temporary jobs-based stimulus injections can’t address long-term funding of integrated transport networks, power grids, and water systems. Congress even stalls on raising the federal gas tax, despite the insolvency of the Highway Trust Fund.

The likely future funding course involves raising revenues from more and higher user fees tied directly to providing necessary investment capital for infrastructure systems, rather than reliance on general taxes, which distort and hide costs from the public. More public/private partnerships can help finance infrastructure development and operate systems. A National Infrastructure Bank could also help align government and private investor interests, and attract greater private capital. Innovative tolling technologies and smart meters can help users gauge and manage expenses directly related to transportation, water and energy, encouraging more efficient and less costly lifestyle and business decisions. In turn, enhanced revenue sources should help ensure Americans have safe, vanguard systems to promote commercial growth and meet quality of life expectations.

The Investment Imperative
Investing in infrastructure—done well and strategically—can help ensure increasing prosperity and the rising standards of living that Americans have come to expect. Countries around the world—China, India, and those in Europe—understand the infrastructure investment imperative and are building the transportation, water, and energy systems that will grow their economies for future generations. The U.S. must find the leadership, the will, and the resources to do the same.