Utility Launches Income-Based Water Bill Program

The Philadelphia Water Department is trying to help struggling ratepayers and at the same time perhaps bolster overall collections
Utility Launches Income-Based Water Bill Program

Water infrastructure needs to be maintained. That costs money. And most of that money comes in via utility ratepayers — some of whom struggle to keep up with their payments.

The Philadelphia Water Department is preparing to launch a new assistance program to help those ratepayers and in the process hopes to improve upon its actual collection totals. The wrinkle in this program, which will open for applications in July, is that ratepayers don’t have to become delinquent on their bills first in order to receive assistance and what they pay will be based around their income.

“This is innovative in that it’s giving people an affordable rate so they’re able to stay current,” Revenue Commissioner Frank Breslin told Philly.com. “We are really putting an affordable bill in their hands.”

For those in the program, payments will be tied to their household’s income rather than water usage. Payments will range from 2 to 4 percent of income. Customers with unusually high usage will be required to meet with a conservation specialist. The program will be open to anyone with an annual income under 150 percent of the federal poverty level. For example, that would be $36,900 for a family of four.

According to the Philly.com report, even customers who don’t meet the income threshold could potentially qualify if they have a hardship, such as losing a job or being a victim of domestic violence. For customers carrying existing debt into the program, it will be indefinitely suspended, and penalties and interest on that debt would be forgiven after two years of on-time bill payments.

“This is the most progressive collection strategy for water in the country,” Councilwoman Maria Quinones-Sanchez told Philly.com. “Our current program, we keep accumulating interest and penalties, so you disincentivize people from becoming compliant. Now there’s a pathway out that makes sense.”

According to the Water Department, about 40 percent of ratepayers are currently delinquent on their bills for a total past-due amount of about $262 million.

The new assistance program has an $18 million annual budget, which was already factored into the Water Department’s most recent rate increase that started in July 2016. Water Department officials say they hope to enroll upward of 50,000 households, five times the number of customers in the utility’s current program.

Source: Philly.com


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