U.S. Rep. David McKinley, R-W.Va., asks a question during a meeting Friday with local utility and municipal representatives at the Parkersburg Utility Board offices. (Photo by Evan Bevins)
PARKERSBURG — Local city and utility representatives who met with U.S. Rep. David McKinley on Friday said the federal funding they’ve gotten or stand to receive is not going to buy as much as expected.
Vienna Mayor Randy Rapp told McKinley, R-W.Va., the cost estimate for a planned water line extension the city is funding with a portion of its American Rescue Plan Act money increased by 60 percent from the original design.
“And we didn’t change a thing; it’s just the material cost, it’s skyrocketing,” Rapp said.
The meeting was held at the Parkersburg Utility Board offices off 19th Street.
PUB Manager Eric Bennett said a planned water system improvement project was at one point expected to cost $14.6 million, to be paid for with $7 million in ARPA funds allocated by Parkersburg City Council and a rate increase that was reduced because of the other money. When bids came in, the price tag was $19.3 million, causing the utility to borrow more money and tap into its reserves to pay for the work.
U.S. Rep. David McKinley, left, listens to Craig Richards, right, director of engineering services for Burgess & Niple, during a meeting Friday at the Parkersburg Utility Board. Also pictured are, clockwise from left, Anna Rittenhouse with McKinley’s office, Fred Rader with the Mid-Ohio Valley Regional Council, Rodney Holbert with Burgess & Niple and Vienna Mayor Randy Rapp. (Photo by Evan Bevins)
“If this inflation continues, we’re going to have to be down at City Council again asking for another rate increase to be able to keep providing” safe and reliable water service at the current level, Bennett said.
Bennett gave McKinley a sheet showing how the prices for materials the utility uses have increased in recent years. Among the biggest was PVC pipe, with the 6-inch type used for water lines increasing from $5.71 per foot in August 2018 to $15.22 in September, a jump of more than 166 percent. The 8-inch kind used for sewer lines rose from $3.54 a foot in August 2019 to $11 in January, a nearly 211 percent rise.
McKinley thanked Bennett for the information, saying he’d heard complaints about soaring material costs but hadn’t seen it spelled out in black and white.
“It’s stark,” he said. “You really rocked my boat here with this.”
Craig Richards, director of engineering services for the Parkersburg office of Burgess & Niple, said a representative of a pipe-producing company told him “he believes the pipe prices are on the floor, not the ceiling.” Contractors bidding on projects know the material prices may not be fixed until the supplies leave the facility.
U.S. Rep. David McKinley, left, looks over figures provided by Parkersburg Utility Board Manager Eric Bennett, right, during a meeting Friday at the PUB offices. (Photo by Evan Bevins)
“We assume what they’re doing is they’re guessing what they’re going to be paying for that pipe when it leaves the factory,” Richards said.
And the PUB had to get its rates and bond approved by Parkersburg City Council months before the project was put out to bid.
McKinley said inflation is at its highest rate in 40 years and is three times higher in the U.S. than Europe. As a member of the House Energy and Commerce Committee, he said he’d like to have an oversight hearing to look at the causes. But because Democrats hold the majority in the House, Republicans can’t set the agendas, he said.
McKinley asked those in attendance what they believe are the causes of the increases and how they could be addressed.
Bennett said a severe cold event last year in Texas affected resin plants there and disrupted the supply chain.
“That’s when it started,” said Fred Rader, community development director for the Mid-Ohio Valley Regional Council, which assists communities in obtaining federal assistance for water, sewer and other development projects. “Why it’s still going on, I don’t know.”
Bennett suggested it’s “opportunistic” because demand has increased with the ARPA money aimed at spurring water and sewer projects and the recently approved federal infrastructure bill following on its heels.
“Everyone speculated that prices were going to shoot up,” Parkersburg Mayor Tom Joyce said. “There’s not enough contractors to handle this stuff either.”
McKinley, who has taken political heat for being among the few Republican House members to vote for the infrastructure package, asked rhetorically if the bill should have been passed.
“Absolutely,” Rader said. “The demand for infrastructure in West Virginia is substantial.”
McKinley said he’s had no second thoughts about supporting the bill.
“I put my future on the line with that,” said McKinley, who faces multiple challengers in the upcoming Republican primary for the newly formed 2nd Congressional District, including fellow Rep. Alex Mooney. “I have no qualms about it; I know it was the right vote.”
He said so-called “social infrastructure” provisions were removed from the bill, and about half of the $1.2 trillion price tag was reauthorizing previously approved spending.
Bennett pointed to the deadlines for allocating and spending the ARPA money and said perhaps extending that timeframe could alleviate some of the problems. Richards said the West Virginia Legislature established a fund that could use ARPA money to provide aid when eligible projects come in over budget, but so far, no money has been placed in it.
Perhaps Congress could develop incentives for some manufacturers to increase production of materials, McKinley said.
McKinley asked Todd Grinstead, with the West Virginia Rural Water Association, to pull together some data and suggestions from his group and requested Richards provide input from the Contractors Association of West Virginia’s Joint Utility Committee.
“I want to know how we fix it,” McKinley said, adding he would push for an oversight meeting in his committee.
Evan Bevins can be reached at ebevins@newsandsentinel.com.
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