Commentary: How Engagement on Federal Infrastructure Funding Is Playing Out Locally

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By Ahmed Badruddin

Both the American Rescue Plan Act (ARPA) and the Infrastructure Investment and Jobs Act (infrastructure bill) represent landmark moments in the U.S. infrastructure industry. Their impact on business development and strategic planning is unlike anything we’ve seen in our 10 years serving the water industry. In particular, there has been an overwhelming desire to track funding allocation, with questions such as “Where will funding land (and when)?” “Where should we be hiring?” and “Which entities are already beginning to allocate funding?” dominating board room conversations, strategic planning sessions and sales team meetings.

Citylitics is uniquely equipped to find the earliest trends from entities discussing the bill. Our data engine and processing technology aggregate insights from council meeting minutes and agendas, capital plans, infrastructure plans and permits across more than 20,000 municipalities and 3,000 counties. This includes references to ARPA and the infrastructure bill (or ‘mentions’) and the surrounding context.

Beginning with the most pressing question we’ve been asked recently, “Where should we be hiring?” we’ve found that there are, in fact, hot spots of early planning conversations. In relation to funding from the Infrastructure Bill, California and Missouri have been leading in engagement across all states (14.89 and 12.76 percent, respectively). As a result, they represent regions where we expect to see some of the first projects emerge. While we’re seeing a broader disbursement of planning conversations around ARPA funding, California, Vermont and North Carolina remain in the lead and we expect to see a wealth of new infrastructure projects emerge in these states in 2022 and beyond.

With so much weight resting on relationship building as part of the business development cycle, executives need to know with whom their teams should be building and strengthening relationships. So, who should companies be speaking to?

As it relates to the infrastructure bill, water and sewer districts are by far the most engaged in planning conversations (53 percent), while towns (21 percent) remain in second place. The least engaged entity in planning are ports (1 percent). However, when we look at which entities are discussing ARPA funding allocation, cities and towns are more active (41 percent and 33 percent of all conversations respectively). Water districts (7 percent) do not appear to be as engaged in conversations around funding given that ARPA funding is for state and local governments specifically. Although states and local governments can transfer funds to other agencies such as water districts, it’s not surprising that engagement levels are lower than in cities and towns.

We’ve also looked at the types of priorities emerging. While most conversations are still general in nature, we do see project prioritization trends beginning to emerge when those conversations become more granular in nature. For instance, when it comes to funding from the Infrastructure Bill, water supply and quality projects, including safe drinking water and PFAS remediation, are top priorities, ahead of new infrastructure needs, climate & resiliency initiatives, etc. Given water and sewer districts have been disproportionately vocal entities so far, it’s relatively unsurprising that water infrastructure upgrades have taken the early lead for specific project mentions.

When conversations around ARPA funding dive into specifics, we can see that improvements to existing infrastructure and wastewater specific initiatives take priority ahead of new infrastructure, clean drinking water etc. Again, this makes sense considering that conversations around ARPA are taking place in cities and towns. Many cities and towns are finding themselves in a position to begin focusing on aging infrastructure and improvements that may have been put off for some time. It’s likely that the emerging prioritization of wastewater initiatives is, in part, due to the burden of population shifts because of the pandemic.

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Sources: Council Meeting Minutes & Agendas, Capital Plans, Infrastructure Plans, and Permits from over 20,000 Municipalities and 3,000 Counties. Analysis results are generated from a search of over 1.6B documents in the Citylitics Data Warehouse.

Why Does This Matter?

As any professional in the industry can attest, waiting until the RFP is issued is too late to influence the deal and leaves no guarantee that your company will be awarded the contract. It also makes it difficult to allocate resources accordingly on such short notice. To gain and maintain a leadership position in the market it’s imperative to plan ahead by deciding which regions to target and hire for and which relationships to strengthen. Advance planning also provides time to position your company according to the entity’s needs and the types of projects being prioritized.

How Does Citylitics Deliver Predictive Intelligence?

Our processing technology scans websites of these municipalities and counties and automatically converts public documents into data insights housed in our Data Engine. Once captured, our proprietary algorithms index and categorize these documents so that we can search the documents in a reliable and consistent way.

By applying various lenses to the data (geography, timeframe, etc.) and using a combination of algorithm and data searching tools, we can identify ‘mentions’ of ARPA and the Infrastructure Bill in the context of water infrastructure specifically. We’ve isolated the surrounding context of each mention to see whether new funding was discussed in the context of existing infrastructure projects & improvements, net new infrastructure projects, or other specific types of projects (for example, drinking water, climate resiliency initiatives, etc.). We also analyzed the frequency of results to identify regional hotspots and to gauge overall engagement levels across different entities: municipality, town, city, water district, and county.

The result is a clear picture of emerging project hotspots and priority topics as the direct result of ARPA and infrastructure bill funding allocation.

Ahmed Badruddin is the CEO of Citylitics Inc. and is a recognized pioneer and expert in the use of data, artificial intelligence and digital technologies to accelerate business outcomes. Prior to Citylitics, Badruddin worked in various technology leadership roles at Microsoft.

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