A closer look at water funding in the Infrastructure Investment and Jobs Act
In November 2021, President Biden signed the Infrastructure Investment and Jobs Act (IIJA). This historic $1.2 trillion bill allocates $55 billion for our country’s water infrastructure. This investment includes funding for drinking water and wastewater treatment projects in hopes to expand access to drinking water to people across the country.
The IIJA includes significant opportunities for our clients and partners in the water market. Comparing the legislation to previous funding levels, it’s easy to see the increases from past financial support. The numbers show a significant increase in funding for water-related projects, including drinking, clean, storm, and delivery. For instance, the authorization of drinking water funds to the State Revolving Fund (SRF) is approximately 2.8 times more than previous appropriations. The funding authorized for clean water is approximately 1.8 times more than previous appropriations, and the U.S. Army Corps of Engineers’ (USACE) civil budget continues to steadily grow and is approximately 55% more than the 2017 appropriation levels. Some traditional federal water programs, such as funding for the Bureau of Reclamation, are not showing significant increases, however, they did not lose ground and still have an authorized increase in funds.
Another change in the IIJA to our legislative water past is the significant focus for funding in underrepresented communities, which include small cities (<10,000 people), towns, and rural regions. We are interested to see how small communities and underrepresented communities will take advantage of these new funding opportunities. Hopefully, the number of regulations attached to the federal funds will not be a deterrent to communities that don’t have the resources to complete the necessary grant and proposal requests. If communities need help with regulatory requirements or proposal writing, Garney and its industry partners can provide assistance or direction as to how our stakeholder communities can navigate the federal aid process. Some of the new federal programs now allow for an outright grant of funds, whereas before, those same funds may have been provided as a loan. In addition, some of the loans are now at significantly reduced interest rates—or in some cases, zero interest. If underrepresented and marginalized communities can develop the proposals, these rule changes will make it easier and more cost-effective for them to build projects.
As for timing—when will we see these funds in tangible projects? Considering the amount of regulations, grants, and proposal writing required for the funds to flow through projects, it is reasonable to assume that the majority of these funds will not have a big impact on our market until 2023.
As a final point, whether the additional federal funding is for water/wastewater work or other areas of heavy infrastructure, the amount of funds available in the next five to ten years for projects in the infrastructure space will significantly increase. This infers that more labor resources will be required in the industry to execute the projects that are an outcome of this additional funding. Finding and developing enough craft workers and project management capable of executing in the construction industry will be a challenge and a requirement for bettering infrastructure in the United States for years to come.
Written by Jay McQuillen, Director of Federal Operations
Garney’s P3 offering expands with new financing expertise
Garney’s public-private partnership (P3) business strategy continues to advance with the addition of David Bird as vice president of project finance and development. David will focus on growing Garney’s existing development pipeline of P3 water projects in North America.
Now with project finance and development capabilities, Garney can offer clients the entire spectrum of P3 capabilities through its own resources and those of its strategic partners to deliver water projects—from development to design, construction, operations, maintenance, and financing.
Climate change is driving the need for public water projects, including more creative projects involving reuse, regenerative farming, water banking, the use of currently non-potable water, and more efficiently treating solids in wastewater to reduce greenhouse gases. At the same time, there are public constraints in completing these projects—lack of upfront funds, low tolerance for risk, and little to no development staff at water agencies.
“Given that we’re solely focused on water, with several successful projects under our belt, and now the added expertise of financing, we’re uniquely positioned as the only construction firm in the water sector to provide an end-to-end offering,” said Garney CEO Mike Heitmann. Unlike most large concessionaires and contractors, Garney self-performs most of its work, making it a leaner organization while still maintaining the skills to help customers secure financing to successfully fund water projects, particularly large, complex projects.
Garney has completed more than $1.1 billion in P3 water projects since 2011, with numerous public-private projects currently in development. The award-winning Vista Ridge Water Supply project, the largest P3 water project in North American history, is an example. The new infrastructure expands San Antonio’s water supply by 20 percent. David Bird served as financial advisor to the Vista Ridge project.
The Garney P3 strategy is to partner with water rights holders, technology providers, water developers, and private equity to bring tailor-made projects to public and private sector clients, reducing their development risk. With the new financing services and the addition of David Bird to the Garney team, Garney is now a one-stop resource that brings seamless efficiency to every stage of a P3 project.
David joins Garney from Societe Generale, where he was a managing director focused on infrastructure finance and advisory. He spent the last 15 years raising debt and equity capital for infrastructure projects in a variety of sectors, including water, roads, ports, airports, and digital infrastructure. Through this work, David forged relationships with lending institutions, equity providers, developers, and rating agencies, which he now leverages on behalf of Garney clients to help them realize successful projects.
Employee-owners provide clean water to 150 Guatemalan families
In early August, employee-owner Jeff Seal and eight others from Garney traveled to the village of Los Limones, Guatemala, to oversee the finishing touches of a new water system installation. Prior to the installation, women and children of the village made treacherous hikes daily to collect buckets of water for their families—sometimes spending hours a day to collect water for a single meal. The villagers also told stories about contracting water-borne illnesses due to the uncleanliness of the water. It was time to make a change to better the lives of the Los Limones residents.
Construction of the water system consisted of a concrete spring catchment system, 12,000 feet of 2-inch transmission main, a concrete wet well and solar-powered pump, 13,000-gallon water tank, and 26,000 feet of distribution piping to 150 individual homes. The village residents provided their time and labor to construct the project. Garney, Lipscomb University, and other volunteers worked with Asociacion Para El Desarrollo Integral Comun Ak’ Yuam (ADICAY), a local engineering firm to help design, plan, and oversee construction of the project. In addition to building the new water system, the project team worked with the village to establish a water committee to maintain the water system.
The Garney employee-owners who accompanied Seal included Mike Heitmann, David Burkhart, Jay McQuillen, Jordan Carrier, Tom Roberts, Neil Ryan, Edwin (Felix) Cabrera, and Edgar Elias. Cabrera and Elias both have family living in Guatemala and were able to reconnect with them during downtime from the project.
“For me, knowing the impact that Garney’s contribution made to the villagers was very fulfilling. The immediate impact is the availability of water. The long-term impact is better educated children, lower infant mortality rates, and longer lifespans for the Mayan people,” said Garney CEO Mike Heitmann.
The project concluded on August 8, 2021, and now provides clean water to 150 families in the area. The villagers expressed great gratitude towards all parties involved. Garney is honored to be a part of this project and looks forward to returning to Guatemala to provide water to even more families.
Jeff Lacy retires after 27 years
Garney’s former Chief Financial Officer and long-time employee-owner Jeff Lacy retired March 26, 2021, after nearly 27 years with the company.
Jeff graduated from Westminster College with a degree in Accounting, Economics & Business Administration. He was an auditor with McDonnell Douglas and then spent several years as Vice President of Finance at a grocery company in Kansas City. Jeff joined Garney in May 1994 as Controller. In addition to overseeing all accounting, human resources, and information technology personnel, Jeff developed, implemented, and administered long-standing accounting policies and internal controls at Garney. His business acumen brought computers and email to Garney as well as a keen strategy for using data. Jeff’s recommendations and guidance allowed the company to do more with less effort—a Garney trademark.
Throughout his career at Garney, Jeff was a key player in the acquisitions of Grimm Construction, Encore Construction, Weaver Construction, Warren Environmental, and A&W Maintenance. He worked to integrate these firms’ accounting systems as seamlessly as possible while also embracing the new employee-owners and educating them on Garney’s ESOP and benefits. Jeff was also instrumental in helping secure the Vista Ridge Water Supply Project—Garney’s largest project to date and the largest public-private partnership (P3) water project in North America. Jeff made a tremendous impact on the company, guiding decisions on Garney’s ESOP, insurance, and other benefits for its employee-owners.
Jeff’s mantra has always been, “You will get all you want in life, if you help enough other people get what they want.” (Zig Ziglar) Jeff’s legacy is so much more than what he accomplished throughout his career—he has profoundly impacted Garney’s employee-owners for the last three decades and for future generations to come. His infectious laughter will be missed around here!
Jordan Carrier and Matt Reaves appointed as Garney’s newest Directors
Jordan Carrier and Matt Reaves have been promoted to Director over their respective regions, expanding Garney’s leadership team in the Eastern United States. As Directors, Jordan and Matt are responsible for project acquisition, contract management, staffing, safety, scheduling, and client satisfaction.
Jordan is Director of Virginia Pipe Operations, overseeing Garney’s Mid-Atlantic pipeline work. He has spent his entire career at Garney after graduating from Eastern Kentucky University, and has since managed more than $315 million worth of water and sewer pipeline projects. Jordan thrives in this industry and stays involved as an active member of WEF, AWWA, and NUCA, as well as being a certified Associate Design-Build Professional. Jordan is based in Fairfax, Virginia.
Matt is Director of Carolinas & West Tennessee Plant Operations. He joined Encore Construction (now Garney Construction) after graduating from the University of Central Florida. Matt has managed nearly $1 billion worth of water and wastewater utility infrastructure projects—including six collaborative delivery projects—throughout North Carolina, South Carolina, Tennessee, and Florida. He is Garney’s alternate board member of the Water Design-Build Council and is based in Charlotte, North Carolina.
Learn more about Jordan and Matt and connect with them on LinkedIn:
Garney trials new Kenzen smart device to protect workers from heat stress
Garney, a firm focused singularly on water and wastewater construction, is interested in keeping its employee-owners as safe as possible on the job. Recently, the company added a new element to its already robust safety programs by testing new wearable technology smart devices.
The devices, worn on the arms of 28 Garney workers at 10 worksites throughout the U.S., are manufactured by Kenzen. They monitor key physiological indicators of each worker, including core body temperature, heart rate, and exertion level. Detecting changes in these factors can lead to proactive prediction and prevention of heat injuries and illnesses, including fatalities.
“We’re committed to continually evaluating new methods of protecting our employee-owners and incorporating the best solutions available,” said Ryan Smith, regional safety manager at Garney who coordinated the proof-of-concept project with the company’s environmental health and safety (EHS) leaders and regional project supervisors. “We’re looking to add more prevention approaches to our systems, which now include education and training, hydration, monitoring atmospheric and ambient heat, and cooling stations.”
Data from the wearable sensors provide alerts to workers by sending vibrations to the device and notifications to their smartphones, and to supervisors via their phones and a web dashboard that provides real-time heat health status of all team members. Alerts escalate from an initial “stop work” message to rest and hydrate, to subsequent alerts for additional measures to avoid emergency situations. Follow-up alerts indicate when a person’s core body temperature has returned to a safe level for resuming work.
Cumulative data can be analyzed by EHS leaders at the company to detect patterns and customize heat stress prevention and treatment strategies at various locations – from the dry heat of Arizona to the extreme heat of the Texas sun, to the hot humidity of Florida, and heat conditions at Colorado altitudes. Garney used the location-specific information to adjust break times and educate employee-owners on steps they can take to protect themselves, such as how to acclimatize to warm working conditions when coming onto a worksite, and best clothing choices.
Although Kenzen collects large amounts of physiological data from each worker, varying levels of information are provided to different viewers to protect workers’ rights, especially with regard to the privacy of their personal health information.
“Garney is on the leading edge of bringing technology into the safety equation,” said Heidi Lehmann, co-founder of Kenzen. “Because Garney is owned by its employees, all were involved in the decision and all are interested in advancing their business through increased safety and productivity.”
Founded in 2014, Kenzen is the premier physiological monitoring platform to keep workforces safe from heat, fatigue, and overexertion on the job. For more information about heat stress and how to integrate the system into your safety plan, visit Kenzen.com.
Garney headquarters moves to North Kansas City
Garney Construction has relocated its company headquarters. Strong growth drove the need for a larger office space than its long-time location along Vivion Road in Kansas City. The new headquarters, a 32,000 square-foot renovated warehouse office, is located at 1700 Swift Street, North Kansas City, MO 64116.
Garney had been located on Vivion Road since its beginning in 1961. The company, founded by Charles Garney, started out in a small building nicknamed the “Hot Dog Stand.” After a couple years, the company outgrew that space and relocated to 1235 NW Vivion Road, then moved to 1331 NW Vivion Road in the early 1970s. Garney built a new location at 1333 NW Vivion Road in 2001 where it remained until November 2020. Over the last 59 years, Garney Construction has become the nation’s leader in water and wastewater systems with annual revenue exceeding $1.1 billion in 2019. That success and growth led the company to seek expanded space for 75 employee-owners who operate from its headquarters.
“We are excited to join the North Kansas City business community,” said Mike Heitmann, CEO of Garney Construction. “We wanted to remain in the Northland, and the walkability and energy of North KC really appealed to us.”
As the company grew, Garney recognized that it had outgrown its space at 1333 NW Vivion Road, even after two recent expansions—including a renovated basement and separate shop converted to office and training space—that added 8,700 square feet to the original 8,000 square-foot building. Garney’s leadership found the best space to suit their needs in North Kansas City. Renovations to the new office are being completed by Gould Evans as architect and Haren Companies as the general contractor.
“Gould Evans and Haren have really created a space that our employee-owners are going to be excited about. They have focused on customizing the building to fit Garney’s current and future needs and providing a smooth transition for our employee-owners,” said Tony Kempf, Vice President and building manager.
Imagine a Day Without Water video highlights critical need
Every day, people drive on, under, over, and around public infrastructure. The first two are easy to observe—the roads you drive on and power/telecommunication lines you drive under. What you don’t see is what you drive over and around—waterlines that bring clean water to your home and workplace, sewer lines that take away your liquid waste, and the facilities cleaning and treating that water.
Do you know which one you can’t live without? Water.
Garney created a video to Imagine a Day Without Water. It’s a good reminder that water is essential for everything we do in life.
Imagine a Day Without Water is led by the Value of Water Campaign to raise awareness about how water is our most precious resource, yet the most undervalued. America’s water infrastructure is rapidly aging and deteriorating. Since water infrastructure is largely invisible, it’s out of sight, out of mind for most people. While nature provides water, it takes pipes, pumps, equipment, and people working 24/7 to deliver clean water to homes and businesses, and then remove and treat wastewater so it can safely be reused or returned to the environment.
The gap between funding water and our water infrastructure needs is growing daily and is currently at $81 billion, according to a recent study by ASCE and the Value of Water Campaign. We can’t continue to ignore this fact. Let your local, state, and national elected officials know you want change and support increased water funding and necessary rate increases required to make this happen.
Learn more at imagineadaywithoutwater.org and follow the conversation on social media at #ValueWater.
Kipp Connell promoted to Director of IT
Garney is pleased to announce the promotion of Kipp Connell to Director of Information Technology (IT). After serving as Garney’s IT Manager for the last five years, Kipp’s promotion creates the new role of Director of IT. In this role, Kipp will continue to oversee Garney’s responsive and agile IT team as well as maintain our backend security. Kipp’s integrity, positive attitude, and approach to problem-solving have facilitated improvements in the behind-the-scenes systems that support and protect Garney’s employee-owners. Kipp joined Garney in 2015 after working in IT for the Lawrence, Kansas, Police Department for 11 years. He attended Washburn University and holds degrees in information technology and business administration.
Meggan Krase promoted to CFO
Garney is pleased to announce the promotion of Meggan Krase to Chief Financial Officer (CFO). Throughout her career at Garney, Meggan has demonstrated tremendous work ethic and dedication, which has propelled her to achieve this important position. Her humility, service-minded orientation, and willingness to do whatever it takes demonstrates her commitment to Garney and her team. What’s even more impressive is her courageousness to blaze this trail in a traditionally male-dominated industry like construction. The respect and admiration she has garnered from her peers in operations is a testament to the type of leader she is. Jeff Lacy is leaving a tremendous legacy at the CFO position and replacing this leadership is no small feat. However, Meggan is fully capable of taking the reins and leading the financial side of our company into the future.