Pew Comments on Proposed Changes to Governmental Financial Reporting on Infrastructure Assets

The Pew Charitable Trusts submitted a letter on Jan. 17, 2025, to the Governmental Accounting Standards Board (GASB) commenting on the board’s preliminary views on accounting and financial reporting for certain types of infrastructure assets.

Among the recommendations included in the letter, Pew encourages GASB to revisit its preliminary decision that deferred maintenance on infrastructure assets is not a liability for the purposes of government financial reporting. When state and local governments defer needed maintenance and repair for public infrastructure, they create a claim on future budgets to address past and current shortfalls. As such, determining that deferred maintenance is not a liability can lead to an incomplete understanding of a significant public finance issue.

The letter also encourages GASB to support the use of an accounting approach that allows financial statement users to measure whether governments are preserving public infrastructure assets at the minimum condition levels that they have established or falling short. Furthermore, Pew supports GASB’s proposal to require additional data in financial reporting to improve public transparency on infrastructure assets and recommends targeted adjustments to the proposals that would clarify the requirements and enhance the information made available in governmental financial statements.