Ogden, Utah, wastewater treatment plant expansion is rare sector capital project.

So much to do, so little money with which to do it. That paraphrasing of the familiar adage sums up the mood of contractors regarding the water and wastewater infrastructure market. With expansion and upgrade projects in many parts of the country curbed by anemic economic growth and cutbacks in government spending, the market is now focused on helping clients keep their aging systems one step ahead of both time and tightening water-quality mandates.

Pat McCann, CEO of Weston Solutions, West Chester, Pa., says many markets are suffering from a “stimulus hangover” as American Recovery and Reinvestment Act funding dries up. “ARRA money kept things going when the other sources ran out,” McCann explains. “With that funding running out, contractors find themselves back where they started.”

The result, adds Rich Cavallaro, president of Whitestone, N.Y.-based Skanska USA Civil, is intensified competition for those project opportunities that do materialize. “If you can't find a way to be the low-cost provider,” he says, “you need to find something else to do.”

Compounding the uncertainty, Cavallaro says, is the fact that there are few large-scale projects poised to take the place of current jobs, such as the $1.2-billion, 2-billion-gallon-per-day Catskill/Delaware Ultraviolet Light Disinfection Facility and the $1-billion upgrade to the Croton Water Filtration Plant, both for the New York City Dept. of Environmental Protection. “Owners are doing very little planning, which is a bad sign,” he says. “There's no long-range vision on projects. They're just trying to maintain the status quo.”

Dan McCarthy, president and CEO of Overland Park, Kan.-based Black & Veatch Global Water Business, sees a transition away from new or expanded treatment-plant projects to projects such as underground networks, pumps and reservoirs. “This is a long-neglected area that I think will become a growth market,” McCarthy says.

That area also includes projects to address wastewater discharges and combined sewer overflows, such as Indianapolis' $1-billion Fall Creek/White River Tunnel System Project, a 7- to 10-mile underground sewage storage and transport system, and Cincinnati's $244-million CSO control project that comprises a 1.2-mile tunnel, pump station and high-rate treatment plant.

However, with the backlog of needs increasingly outpacing established state and funding resources, where will owners find the construction dollars for these and other projects?

“If they can't issue bonds or raise rates, they'll look at the private sector,” says Luis Ventoza, regional vice president for British Columbia-based PCL Construction Enterprises Inc. He adds that while public-private partnerships for water and wastewater infrastructure are few and far between in the U.S. now, “it will be used more in the future.”

Ventoza further predicts that more municipalities will take a closer look at design-build and design-build-operate as ways of stretching their construction dollars. Denver-based PCL, for example, used design-build on the recently completed $11-million, 315-mgd Tesla Treatment Facility, the nation's second-largest ultraviolet treatment facility, for the San Francisco Public Utilities Commission. PCL, the design-build lead, was also the contractor.

Despite the current slump, most contractors agree the long-term picture is very good, given a continually growing backlog of “catch-up” infrastructure needs and water-quality mandates as well as regional population growth.

The next 12 to 18 months, however, pose the biggest challenge facing the contracting community. Says McCann, “It'll be a matter of how long these systems can go before they break.”