Because utility valuation is a relatively infrequent occurrence, it’s all the more critical that municipalities and private utilities understand the process.
Moreover, today’s high operating expenditures for water and wastewater utilities make it particularly important that municipalities clearly understand the current value their assets so they can prepare for changes tomorrow.
A 2018-2027 FORECAST by an independent research firm predicts water and wastewater utilities’ operating expenditures will exceed $872 billion between 2018 and 2027, topping $93.8 billion by 2027. Utilities looking to replace aging infrastructure by building or buying new will need accurate insight into the value of their systems. An asset-based appraisal can help a municipality get a clear sense of the value of the often-hidden structures that support its utility. But because regulations are changing fast at the state level, it’s important that municipalities work closely with an expert in valuation.
By working with an experienced consultant and adequately preparing for a valuation, a municipality can maximize its asset sale or purchase, ensure they’re not overbuilding, and better protect its assets, constituency and rate payers.
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