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FROM THE PUBLISHER’S DESKMunicipal BondsThere has been increased reporting in the financial press about the condition of municipalbonds. Of course, this directly affects the ability to finance water infrastructure work.There is concern in the investment community about stale data coming from munibond issuers. States and municipalities are notoriously late when it comes to disclosingfinancial information. It is reported that government borrowers take an average of fivemonths to close out a fiscal year and get an audited financial statement. Then it takesanother month for all final approvals. Corporate borrowers, in contrast, must file theirannual reports within 60 to 90 days after a fiscal year end. The result is that bond ratersgenerally penalize government borrowers for tardy financial disclosure.Of course the financial downturn just makes things particularly difficult. Previously,many government bonds were insured and therefore were perceived as safe. Back in2006 about half of all new government bonds carried insurance. That number is nowdown to about 7 percent.It was usually the opinion that general obligation bonds could withstand difficult timesbecause the government authority would raise taxes to make good on its debt. Not sothese days! As noted recently in the Wall Street Journal, “Now, some investors are startingto view essential service revenue bonds which are backed by revenue stream from suchservices as sewer systems or water, as equally safe investments.” The opinion is that“income generated from essential services like water seem more reliable.”A positive factor in recent years has been “Build America Bonds.” These bonds initiatedby the Obama Administration offered a new kind of taxable bond that offered a 35 percentfederal subsidy on the interest rate. The idea was to appeal to investors such as pension fundsand overseas buyers who don’t traditionally buy municipal bonds because they cannot takeadvantage of the tax-free status. Congress authorized Build America Bonds though 2010 andis now considering extending the bonds with an interest rate subsidy of 28 percent.Also, consider that investors are getting extremely nervous about unfunded pensionliability. As again reported recently in the Wall Street Journal, “The 50 states unfundedpension bill is $3 trillion and the municipal tab for unfunded pensions could reach $500billion.” We had a situation recently where New Jersey was brought up on SEC chargesbecause it did not properly reflect unfunded pension liability. In that case, New Jerseysold $26 billion in municipal bonds between 2001-2007. It became the first state evercharged for violation of securities laws. New Jersey and the SEC have since settled withno fines levied and New Jersey has agreed to refrain from future violations.So while the muni bond market is going through some dramatic changes, our water infrastructureis reviewed favorably for bond issuance. But you must be timely in issuing financialstatements and be careful to completely report liabilities such as unfunded pension liability.Mystery PhotoIn my July/August Publisher’s Message, we presented aphoto and asked readers to identify who was in it and whatwas the event. This must have been a lot harder to do as wehad a short list of entries and just one correct — DavidPenrice, Aqua Capital Management. He wins the iPodTouch. Congrats, Dave!By the way, this photo was taken atthe world famous cycling race the Tourde France. In this photo is the wellknown devil, who keeps showing up atcycling races in Europe, and Steve Maxwell, who authors theMaxwell Report in every issue of UIM. Steve is an avid cyclist.Happy Holidays!PublisherBernard P. KrzysAssociate PublisherRobert D. KrzysEditorJames W. RushManaging EditorsSharon M. BuenoKeith GribbinsContributing EditorsBradley KramerJason MorganPam KleinekeCreative DirectorW. M. ConleyGraphic DesignersSarah E. HayesChris SlogarElizabeth StullDirector of MarketingKelly DadichRegional Sales ManagerDan SiskoCirculation ManagerAlexis R. WhiteWeb & Interactive ManagerMark GormanEditorial & Advertising Offices1770 Main St., P.O. Box 190Peninsula, OH 44264 USA(330) 467-7588Fax: (330) 468-2289www.uimonline.come-mail: info@benjaminmedia.comBernard P. KrzysPresident & PublisherFor Reprints, contact Wright’sReprints at 877.652.5295.12 Water Utility Infrastructure ManagementNovember/December 2010
eventsMayors Water Council Meets in CaliforniaThe U.S. Conference of Mayors Water Council met Oct.14-15 in Pleasanton, Calif. Pleasanton Mayor JenniferHosterman, Co-Chair of the council, hosted the meeting.There were over 70 registrants.The theme of themeeting was “WaterSupply, Public Healthand Infrastructure:Challenges Facing theNation’s Principal Citiesand the Bay Area DeltaCommunities.” Thefeatured speaker wasRobert F. Kennedy Jr.Kennedy is the sonof the late Sen. RobertF. Kennedy and nephewof former PresidentJohn F. Kennedy.Guest speaker Robert F. Kennedy Jr.(left) and UIM publisher Bernie Krzys.Kennedy is a well-known environment advocate who espousedthat good environmental policy equates to a good economicpolicy. “Protecting the environment is not about protectingthe fishes and the birds for their own sake, but rather, it’sabout recognizing that nature is the infrastructure of ourcommunities,” he said.Kennedy went on to discuss that the United States mustwean itself from energy sources like coal and oil because oftheir potential harmful effects and embrace the country’sabundance of renewable energy sources.The scarcity and shortage of water in California was coveredby many of the presentations. Illustrative of this were thefollowing presentations: “Does Existing Policy Add LegalInstability to the Natural Instability of Water Supply?,” JonRubin, Diepenbrock Harrison; “The Status of Water RecyclingPrograms in Southern California,” Mayor Mary Ann Lutz,Monrovia, Calif.; “Securing Community Water Supplies:Design-Build-Operate Cost Efficiencies in Clovis, Calif.,”Dennis Burrell, CH2M Hill; and “The Impact of WaterInstability at the City and County Level,” John Gioia, ContraCosta Counties.The meetingincluded a mayor’sroundtablehosted by MayorHosterman andher Co-Chair,Mayor BrianStratton ofSchenectady,N.Y. A networkingreceptionwas held at alocal winery.The MayorsNEWSMWH Global, the luncheon sponsor, was representedby John Buttz (left) and Bill Swanson.Water Council was formed to assist local governments inproviding high-quality water resources in a cost-effectivemanner. The council provides a forum for local governmentsto share information on water technology, managementmethods, operational experience and financingof infrastructure development.Mayors in attendance included (l-r): Jill Techel (Napa, Calif.),Sue Digre (Pacifica, Calif.), Mary Ann Lutz (Monrovia, Calif.),Jennifer Hosterman (Pleasanton, Calif.), Brian Stratton(Schenectady, N.Y.), and Susan Gorin (Santa Rosa, Calif.).ASCE Pipelines 2010 aMile High SuccessThe ASCE Pipelines 2010Conference held in Keystone, Colo.,from Aug. 28, to Sept. 1, 2010, was ahuge success. Planners had hoped toget 500 attendees, but their expectationswere exceeded as the conferencedrew more than 600 attendees,with 61 exhibitors and 20 sponsors.Student Days, a program to introducecivil engineering students topipeline professionals and careeropportunities, presented by theConstruction Institute of ASCE, washeld in conjunctionwith pipelines conference.More than 50students from 14 universitiesthroughoutthe United Statesparticipated in teambuilding, educationalNajafisessions and networkingwith industry professionals at theconference.Preconference Workshops werewell attended, with the PCCP User’sGroup meeting attracting over 100attendees. In addition to the 156papers presented insix different technicaltracks over thethree days, thePipeline Divisionawarded Dr.BarsoomMohammed Najafiits Award ofExcellence and presentedJoseph Barsoom the prestigiousStephen D. Bechtel PipelineEngineering Award.Next year’s conference will be heldin Seattle, Wash., from July 23-27,2011.November/December 2010Water Utility Infrastructure Management 13
Page 4: CONTENTSNOVEMBER/DECEMBER 2010COVER
Page 10 and 11: CTAMCertification of Trainingin Ass
Page 14 and 15: NEWSWEFTEC 2010 Sets New Exhibition
Page 16 and 17: NEWSThe project is the fastest, mos
Page 18 and 19: W A S H I N G T O N R E P O R TWate
Page 20 and 21: M A X W E L L R E P O R T By Steve
Page 22 and 23: Seeing theUndergroundNew Technology
Page 24 and 25: To install the new 20-in. diameter
Page 26 and 27: Blue Gold RushMilwaukee Turns to It
Page 28 and 29: The Backbone of Clean WaterInfrastr
Page 30 and 31: Energy SavingsPerformanceContractsC
Page 32 and 33: and verification is accomplished wi
Page 34 and 35: The Effective Utility Management In
Page 36 and 37: Making the Right ChoiceCareful Cons
Page 38 and 39: Challenges of the 21 st CenturyThe
Page 40 and 41: CALENDAR2011January 18-21 Utility C
Page 42 and 43: COMMENTARYDesign-Build-OperateAlter
Page 44: For more information visit www.uimo

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