US infrastructure rebuilding faces politics, money hurdles

By Leonard Anderson

SAN FRANCISCO, Aug 8 (Reuters) - The deadly collapse of a Minneapolis bridge may trigger a repair and construction boom, but politics and financing could stall rebuilding, engineering and construction experts said on Wednesday.

But the industry may be in trouble over the longer term because the numbers of engineering students are dropping.

Renewed attention on the nation's aging infrastructure was triggered by the Aug. 1 collapse of the Interstate 35W bridge, killing five people, with eight other probable victims listed as missing. Officials demanded inspections of thousands of suspect bridges across the country.

"We have to look at infrastructure across the U.S. regardless of the bridge collapse. It comes down to funding and political willpower," said Greg Therrien, president of infrastructure at Idaho-based construction company Washington Group International Inc WNG.N.

Bridge repairs are the immediate focus, but growing pressure for new highways, rail lines, power grids and other projects to support highly populated areas will drive new work, he said.

Democratic Sen. Hillary Clinton proposed an emergency infrastructure plan on Wednesday that would include $10 billion over 10 years to repair more than 60,000 bridges designated structurally deficient by the Federal Highway Administration.

The American Society of Civil Engineers in a 2005 report, however, said it will cost more than $9 billion a year for 20 years to eliminate all bridge deficiencies.

The total tab to lift all the nation's infrastructure to good condition is estimated at $1.6 trillion over five years.

The report gave a "C" to the bridges, while the the power grid, dams, roads, water systems and school buildings each got a "D" and infrastructure security an "incomplete."

COMPANIES EAGER TO BUILD

Companies expected to get a boost in the near term from state and federal reconstruction efforts include Jacobs Engineering Group Inc (JEC.N), Quanta Services Inc (PWR.N), Fluor Corp (FLR.N), URS Corp (URS.N), Washington Group, Shaw Group Inc SGR.N, KBR Inc (KBR.N) and AECOM Technology Corp (ACM.N), KeyBanc Capital Markets analyst Tahira Afzal said in a recent research note.

Privately-held Bechtel Corp and overseas companies such as Spain's Cintra (CCIT.MC) and Australia's Macquarie Bank (MLB.AX) also are likely beneficiaries.

A speed-up in infrastructure spending will depend on funding plans, such as programs tapping both private and public money, which could take time to put together.

The U.S. is moving toward higher public-private partnerships to build toll roads and other public assets, but it is a slow process, Afzal said.

Washington Group's Therrien said the bridge collapse may lead to changes in state and federal regulatory processes and financing changes.

"The safety issue is a catalyst, but the answer is where the money is to accelerate the work," he said.

A secondary issue is whether over the years the U.S. will have the people to do the work.

Engineering students are not seeking posts with state and federal agencies involved in infrastructure, said William Ibbs, professor of civil engineering at the University of California, Berkeley.

Undergraduates majoring in civil engineering fell more than 10 percent from 1992 to 2002, according to the American Society of Civil Engineers.

"Engineering students want to work with well-paying electronic companies and we're also seeing civil engineering students go on to law or business school," Ibbs added.