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California's Infrastructure Policy for the 21st Century: Issues and Opportunities

California's Infrastructure Policy for the 21st Century: Issues and Opportunities

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Although California will need to invest an estimated $82 billion over the next decade to maintain and build infrastructure, projected state and local revenue sources will meet only half of this need. Long-term financing will reduce, but not eliminate, this gap between identified needs and available funding. In California's Infrastructure Policy for the 21st Century: Issues and Opportunities, David Dowall examines this problem, giving special attention to market-oriented solutions.

Citing successful infrastructure experiments in California and elsewhere, Dowall recommends that the state concentrate on policy and management rather than on the direct provision of infrastructure. Because infrastructure needs tend to outstrip available funds, he also urges policymakers to prioritize those needs by focusing on how much the public is willing to pay for particular projects and services. Finally, the author encourages policymakers to implement strategies for reducing or managing demand in such areas as energy, transportation, water supply, and solid waste treatment.

If state government moves from providing infrastructure to managing how it is provided, it will need to restructure the institutional and regulatory environment to foster demand-oriented competition and efficiency. At the same time, it must continue to guarantee that all households and businesses have access to high-quality infrastructure services at fair prices.

This project was supported by PPIC through an Extramural Research Program contract.