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Our Aging and Dangerous Urban Infrastructure

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HARLEM EXPLOSION
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The horrific tragedy of the gas explosion in East Harlem was first and foremost a story of great sadness, coupled with accounts of personal courage and resilience. The tragedy has also renewed discussion about the importance of maintaining our city's aging infrastructure -- both public and private. Earlier in the month, a small local think tank, The Center for an Urban Future, released a report that was unfortunately all too timely, "Caution Ahead: Overdue Investments for New York's Aging Infrastructure". While acknowledging that the city is in better shape than it was in the 1980s when it was literally falling apart, the report notes that many:

...of the city's roads, bridges, subways, water mains, sewer systems, school buildings and other public buildings are more than 50 years old, and many critical components are past their useful life and highly susceptible to breaks and malfunctions. Over 1,000 miles of New York City water mains are more than 100 years old, leading to frequent and disruptive breaks. More than 160 bridges across the five boroughs were built over a century ago, and in 2012 47 bridges were deemed both structurally deficient and fracture critical, a designation engineers use for bridges that have little structural redundancy, making them prone to failure and collapse.

This is not a problem limited to New York City, but one that is seen throughout the United States. In many cities of the "Rust Belt", the infrastructure crisis has been a fact of life for decades. In the relatively newer cities of the "Sun Belt", these problems are beginning to emerge. The declining tax receipts of shrinking cities like Detroit make it difficult for those cities to fund capital projects. The anti-tax and anti-government ideology of many wealthy Sun Belt cities can also make it difficult for those governments to fund capital facilities. In some cases, like the gas lines in New York City, the capital costs are assumed by regulated private utilities who retire their debt by adding it to your utility bill. Many Sun Belt cities are looking to privatize public facilities in order to attract private capital to ensure that the cost of upkeep is hidden in "user fees" rather than taxes.

While New York's infrastructure is aging, the city has a reasonably healthy capital budget. Over the past decade, New York City's capital budget has ranged from $6 billion to $12 billion. New York's overall debt is $68 billion, and while much of the capital budget is devoted to new construction, a substantial portion is devoted to rebuilding existing structures and facilities. The city's debt level is substantial, but not overwhelming. Of the city's annual budget of about $70 billion, approximately $5 billion is devoted to servicing or paying down the city's debt.

I know that to some, "debt" is a dirty word, but it's important to distinguish between a debt and a deficit. A deficit is caused when your expenses exceed your revenues. A debt is caused when you borrow money to build something with the intent of paying it back. Deficits are always bad, but debt can be a sign of prudent investment. One of the concepts behind debt is that since you are building something that you will use for at least twenty years, why not pay the costs of that facility over the first twenty years it will be in use, rather than during the years it is being built? A healthy and visionary organization builds for the future, not simply for the present. While you could wait twenty years and first save the money before you build, you don't get the productive advantage of the new facility for many years. Debt and investment is an indicator of our faith in the future. It can be seen as a sign of strength rather than weakness.

It is also important to understand that all capital projects are not created equal. Politicians love to cut a ribbon on a new school, swimming pool or train station. New construction is always fun and exciting. But what about a project like taking out an old water pipe under the road and replacing it with a new one? Or even a relatively invisible piece of new construction like New York City's multi-billion dollar third water tunnel. Capital projects that involve renovation and repair compete for funding with capital projects that create visible and flashy new facilities. It's not a fair fight. In New York City, some capital projects are funded by the city and controlled by the city. But some, such as mass transit, are controlled by New York State's MTA and some, such as the airports, are controlled by the Port Authority of New York and New Jersey. The Center for an Urban Future estimates that simply ensuring that all existing facilities in New York City are in "good repair" will cost a little more than $47 billion over the next five years, even though only $13 billion is expected to be available for those expenses.

In a complex and interdependent society and economy we share many critical facilities such as roads, power lines, water and sewage systems, bridges, airports, schools and parks. These are not facilities that will be provided by the free market. They are, however, facilities vital for a community's economic well-being. They must be planned, funded, and managed by the government. While most of the actual construction and rehabilitation of these facilities is performed by private firms under contract to the government, they still require a strong, active, and well-managed government to be competently financed, built and operated. A United States congress that can no longer legislate can't be helpful in planning and funding national infrastructure. Today's national government could never design and construct anything like the interstate highway system; it's not even clear they know how to build a website. Anti-tax and anti-government states have similar problems. They do not have the political will or the management capacity needed to build and maintain public infrastructure.

Anyone driving the highways in the Northeast this month knows that those roads have taken a real beating through this endless winter. Bridges, railroad tracks, airport runways, power cables and even underground pipes and power lines are also subject to wear and tear. Regular and routine maintenance and replacement needs to be a standard management practice by government and regulated utilities. It must be adequately funded as an expected element of the budget process. If you own a house you know that every ten to twenty years the roof needs to be replaced. In between replacement, you monitor and patch as needed. If you don't take care of the roof, it costs a lot more to repair the damage that results from the leaks you could have avoided. Government infrastructure is no different.

In the case of aging infrastructure we face the possibility of closed bridges, disrupted water supplies and delays on mass transit. There is also a chance of tragedy when bridges fall, trains derail or gas lines leak. We do not yet know the root cause of the explosion in East Harlem last week. We do know that people lost their lives, their loved ones, their homes and a treasured part of their community. We also know that sadly, there is the potential for plenty more where that came from. We can and must do better.