Medium to Large-scale Water Supply and Sanitation:
Managing and
Financing Services and Systems
by: Curtis Borden
A regular supply
of drinkable water is essential for survival yet, in the past several
years, economic and environmental conditions have combined to make water
supply and wastewater treatment projects increasingly expensive and
difficult to finance. Since grant funds committed to these types of
projects have been subsequently reduced local governments face expanded
responsibilities while constrained by limited budgets. This situation
has compelled many national and local governments to explore a variety
of financing options that will be sustainable over the long-term.
This session focuses
on reviewing financially viable ways of building and operating medium
and large-scale water and wastewater systems. Key issues explored include
the following:
- Institutional
arrangements and fiscal policies at the national level;
- Local assessments
of service provision, fiscal capacity, and willingness to pay;
- Suggested ways
a community can increase investor confidence;
- Improving local
creditworthiness;
- Public and private
options for financing and managing systems; and
- A USAID case
study: the Financial Institutions Reform and Expansion (FIRE) Project.
In short, a properly
designed capital financing strategy will ease cash flow pressures on
the local government, open a formerly public asset to private participation,
and, at the same time, safeguard the environment.
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