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In this report, the EFC develops and implements a simple methodology to estimate local governments’ spending plans for water and wastewater infrastructure across the state of North Carolina in the next five and twenty years. The estimates are determined from a statistically representative sample of 75 local governments’ Capital Improvement Plans and extrapolated to all other local government utilities of similar sizes, after adjusting for inflation.

We estimate that the local government utilities in the state would collectively face about $10.7 – 13.7 billion in water and wastewater capital projects over five years, within a 90% confidence interval, in 2020 dollars. This estimate assumes that all local government utilities in the state have, or should have, planned capital expenses at similar levels to their peer utilities with Capital Improvement Plans that were analyzed. Since a small number of utilities, particularly smaller systems, may not be planning any capital expenses, this estimate is likely marginally higher than what is actually planned across the state over the next five years, and likely higher than what will actually be spent on capital projects in the coming years. Nonetheless, the estimate represents what utilities in the state would be planning to spend if all local government utilities planned for water and wastewater capital projects similar to their peer utilities.

Extrapolating to 20 years of planned capital expenses adds uncertainty because most Capital Improvement Plans do not cover twenty years. Assuming that the trends in Capital Improvement Plan projects continue or repeat through 20 years with a 2%/year cost inflation factor, we estimate that local government utilities in the state would collectively face about $36 – 44 billion in water and wastewater capital projects over 20 years, within a 90% confidence interval, in 2020 dollars. This estimate may be high considering that several of the analyzed Capital Improvement Plans include short-term projects that would likely not be repeated again within twenty years, although many large-scale projects in the latter years may also have not been identified in the analyzed plans. There is a lower degree of confidence in estimating local governments’ planned capital expenses over twenty years than in the five year estimates.

This report summarizes the analysis and results, and provides a comparison to infrastructure needs estimates, actual capital spending trends, and a short discussion of funding capital plans.

 

Click the blue buttons below to download the full report or the short summary infographic.

infographic breaking down the 5-year capital spending plans

 

 

Download Full Report for Estimating The Statewide Water And Wastewater Capital Spending Plans Of North Carolina’s Local Governments Download Infographic

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