The experts within our Infrastructure Group maintain ongoing contact with a wide range of knowledgeable sources to stay abreast of the issues and trends that could impact the industry’s M&A climate or otherwise influence our clients’ businesses. Following are a few of the topics addressed in our most recent Engineering, Construction and Building Materials Review, which is published quarterly.
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INFRASTRUCTURE REVIEW (2010: Q2) (View complete report)
Introduction
America’s infrastructure has sprung a leak. In the most recent “Report Card for America’s Infrastructure,” the American Society of Civil Engineers gave our country’s drinking and wastewater infrastructure a grade of “D-,” the lowest mark of any sector. And although steps have been taken to address the issue, such as a $6 billion allocation in the stimulus bill, water infrastructure in the U.S. still suffers significant funding shortfalls. In this Quarterly Industry Review, McGladrey Capital Markets will highlight the future capital improvement needs within the sector, discuss recent legislation and funding efforts affecting the space, and explain how opportunistic firms are using M&A to capitalize on water infrastructure trends.
Drinking Water Infrastructure Drought
The U.S Environmental Protection Agency (EPA), whose strategic goal is to protect America’s drinking water supply, published its most recent “Drinking Water Infrastructure Needs Survey and Assessment” in February 2009. Every four years, the EPA is mandated to conduct an assessment of the 20-year infrastructure needs of the country’s approximately 73,400 municipal water systems, which serve approximately 85% of the population, and report the findings to Congress. The most recent Assessment estimates that capital improvement of $334.8 billion is necessary from January 1, 2007 through December 31, 2026 for water systems to continue to provide safe drinking water to the public. This figure is up from the $198.2 billion reported in 1999 and the $331.4 billion reported in 2003 (as adjusted to 2007 dollars).
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