The New York Times

September 11, 2005 Sunday

Late Edition - Final 

SECTION: Section 3; Column 1; Money and Business/Financial Desk; Pg. 1 


Disasters Waiting To Happen




MORE than a thousand miles of levees stretch east from San Francisco Bay. They protect the cities and the farmland in the Sacramento-San Joaquin delta of California and keep salt from the bay out of the drinking water of millions of people. But those levees are deteriorating, experts say, raising the odds of a Katrina-like disaster for the nation's most populous state.


The delta and its maze of levees are high on the list of public infrastructure considered to be subpar. That list -- which also includes highways, dams, ports and bridges -- is growing as government outlays for repair lose out to budget cutting. The American Society of Civil Engineers, whose 137,000 members are involved in virtually every public works project undertaken in the United States, says that $1.6 trillion must be spent over the next five years to prevent further deterioration. Only $900 billion is now earmarked.


Absent the additional spending, said Lawrence Roth, deputy executive director of the society, ''every natural disaster is going to be more destructive than it needs to be.''


Infrastructure deteriorates in more than one way. There is lack of maintenance: roughly 13,000 highway fatalities each year, for example, are a result of inadequate maintenance of aging highways, the civil engineers say. And there is overuse: the levees in California, many of them built by farmers to convert marshes to farmland, now must be strengthened to prevent the destruction of newly built communities.


''This is the fastest-growing region in California, and the bulk of that growth is taking place on the flood plains,'' said Jeffrey F. Mount, a geology professor and the director of the Watershed Center at the University of California, Davis. ''What we are doing is creating our own New Orleans.''


To Professor Mount, there is too much deterioration of public infrastructure for the next disaster to be thought of as unheralded. Even before Hurricane Katrina hit the Gulf Coast, for example, there was wide public awareness of the potential crisis that New Orleans faced from its inadequate levees. Yet nothing happened. Why? Repairing or rebuilding infrastructure to protect the public is expensive, and the nation is spending less.


Total government spending on public infrastructure -- that is, spending by states and municipalities as well as by federal agencies -- amounted to roughly 2.25 percent of the gross domestic product in the early 1950's. It rose to about 3 percent in the Eisenhower era of interstate highway construction and in the Kennedy and Johnson years. Through the 1980's and 1990's, however, infrastructure investment fell well below 2 percent, and is now just below that level.


AS spending lost ground, standards changed. Current criteria rely more on a cost-versus-benefit formula, in contrast to the grander visions of those earlier years. Does the benefit from a public investment exceed the cost? Laced into that calculation is a gamble: benefits that rarely occur are not counted. A levee system in New Orleans capable of withstanding a Category 4 hurricane like Katrina is not counted because such storms are fairly rare.


John Paul Woodley, the assistant secretary of the Army for civil works, says he struggles with this standard. He has jurisdiction over the Army Corps of Engineers, which takes the lead in building and maintaining public works along the nation's waterways, including thousands of miles of levees. For the first time, Mr. Woodley is pushing to postpone some projects so that more can be spent on others.


''I have more works in progress than the budget can fund at an efficient level, and that is a problem,'' Mr. Woodley said in an interview. ''I have two options then. I can rigorously prioritize and decide that some will be quickly finished and others postponed, or I can spread the money across all the projects, deferring the completion dates for all of them but postponing none. Our 2006 budget calls for suspension of a large number of projects in order to concentrate on a small number that will be completed efficiently.''


In California's delta, that approach translates into $20 million this year to improve the levees that protect Sacramento, the state capital, at the confluence of the American and Sacramento Rivers, and to strengthen the Folsom Dam, upstream from the city. But virtually no federal money is earmarked for other nearby levees that protect smaller communities, cropland and the conduits that bring drinking water to Southern California.


California's state government struggles with that issue. The Schwarzenegger administration has proposed more spending on the levees than the Legislature has been willing to approve. Katrina raised awareness of the benefits to be reaped, but even before Katrina, a 1997 flood damaged or destroyed more than 30,000 homes and businesses, and a rupture in a levee last year resulted in $100 million worth of damage and repairs.


''It is possible that we are not spending enough on levees, and it is also possible that the people moving in behind those levees are not being charged enough -- for flood insurance, for example,'' said Joshua D. Angrist, an economist at the Massachusetts Institute of Technology. ''If they were required to pay for flood insurance, they might not build there.''


Although the delta and its levees are gaining attention now, after Hurricane Katrina, there are near-disasters that never come to public attention.


The Army Corps of Engineers, for example, shut down the Greenup Locks and Dam on the Ohio River, upstream from Louisville, Ky., two years ago for what the corps thought would be two weeks of routine maintenance. Closer examination, once the work started, revealed much more deterioration than anticipated and the locks remained closed for eight weeks, during which coal could not move up the river on barges to power plants that supply electricity to the Midwest.


''We came very close to not having enough coal to power those plants,'' Mr. Woodley said. The coal did get through before stockpiles were exhausted, so in this case the public never noticed. But power failures would undoubtedly have produced plenty of public outcry.


Locks on the Mississippi and Ohio Rivers shut down more often than Mr. Woodley would like. ''If I had more money,'' he said, ''I could reduce these shutdowns to a level that I might consider satisfactory.''


In this age of rationed public spending, the deterioration of vital public works is increasing, and with it the potential for disaster. The American Society of Civil Engineers, for example, reports that while federally owned dams are in good condition, more than 3,500 dams maintained by states and local governments are ''unsafe'' -- and the number is rising.


''There are a lot of these small dams, and they can do a lot of damage,'' said Douglas Holtz-Eakin, director of the Congressional Budget Office. ''The Johnstown Flood is a famous example of a small dam failing and doing a lot of damage.'' (That flood, in Johnstown, Pa., in 1889, took more than 2,200 lives.)


Something similar is happening with drinking water systems. Instead of an outlay of $11 billion annually, the amount the civil engineers consider necessary to replace aging pipelines and other facilities, federal spending is only $850 million. Highways and bridges also suffer from a shortfall. The highway bill signed by the president this summer stipulates an outlay of $286.4 billion over five years for both new construction and maintenance. Various Republicans, including Mr. Woodley, consider $318 billion as the minimum needed just for maintenance.


States are filling some of the gap. Bridge tolls are rising in San Francisco, for example, to help finance a new eastern span for the San Francisco-Oakland Bay Bridge that is more earthquake resistant than the portion of the bridge damaged in the 1989 earthquake. ''In these cases, people make a decision about the level of risk they want the infrastructure to withstand,'' said Ellen Hanak, a research fellow at the Public Policy Institute of California. And if the risk is considered great enough, they fund it.


Assessing risks, the Army Corps of Engineers chose to spend $30 million this year to build or enlarge 57 miles of levee along the Mississippi River near New Orleans -- but on the west bank, across from the city.


Did the construction ameliorate the damage from Katrina? Mr. Woodley does not think so. ''My initial impression,'' he said, ''is that it protects an area not struck by the surge.''


Photos: Bridge tolls are rising to finance a new span for the San Francisco-Oakland Bay Bridge. (Photo by Noah Berger/Bloomberg News)(pg. 1) In June 2004, Gov. Arnold Schwarzenegger, right, and Henry Renteria, the director of the California Office of Emergency Services, took a helicopter tour of repairs to the San Joaquin County levee, which had broken. (Pool photo by John Decker)(pg. 8)Chart: ''Not Spending as Much''In recent decades, government spending on infrastructure has been about two-thirds of its peak levels in the 1960's.Graph tracks the following since the 1950's: Total government spending on infrastructure as a percentage of gross domestic product. (Includes federal, state and local)(Sources by Bureau of Economic Analysis 8)


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