America’s public transit, roads and aviation system have deteriorated, with the sewage and water systems getting the worst grade, as these have not been upgraded since the Eisenhower Administration, giving related investments and exchange traded funds(ETFs) a chance to rally on the push for improvement.

The American Society of Civil Engineers has given the United States a near-failing grade of D in the infrastructure department. It’s the same grade its had since 2005. One huge difference between now and 2005, however, is that in 2005 the price tag for fixing everything was $1.7 trillion, and now it’s at $2.2 trillion, Seth Borenstein for the Associated Press reports .

This is the first report since the Hurricane Katrina flooding, and America’s 100,000 miles of levees are  the latest area of  failing infrastructure. Levees, which hold back floodwaters, get a D minus grade, with the report saying that the risk for public health and safety has increased.

• PowerShares Water Resources (PHO): up 17.4% over past three months

• Claymore S&P Global Water (CGW): down 4.3% for the last three months

Bill Paul for Seeking Alpha says that America’s water woes are now just one catastrophic incident away from leading the evening news and generating a giant sector rally. As the Obama Administration is taking shape and rebuilding America’s infrastructure is top priority, the talks will move from everyday to Wall Street, potentially giving life to the water ETFs and shares.

The room for improvement when it comes to our water infrastructure could be a boon to ETFs.

Tags: Infrastructure, Obama, PHO, PIO, Sector ETFs