This section will present and evaluate possible policy options for alternative rate structures and customer assistance programs to address unaffordability issues from both equity (fairness, social impact) and efficiency (utility viability) perspectives. This type of policy discussion is necessarily defined by the unique circumstances of the utility service areas. The following discussion relates to the GLWA and DWSD, but can be read to follow the general principles of what alternative practices could apply elsewhere. Before analyzing alternatives for addressing unaffordability, it is necessary to understand the legal landscape that has characterized decision making and rate setting in Michigan.
When the question of water affordability plans and their funding is raised, the Headlee Amendment is brought up as a legal barrier to some proposals to create a robust affordability program. A full accounting of the state of cases on this topic is outside the scope of this analysis, but given the number of active cases and the variability in the outcomes so far, as well as conflicting legal memos to come out of official reviews such as the Detroit Blue Ribbon Panel on Affordability, it is clear that the Headlee Amendment and its application in Bolt do not outright prohibit alternatives to cost-based rate setting, and that each is subject to individual interpretation.93 The fact that the Detroit Blue Ribbon Panel on Affordability did not decide to find alternative rate structures unlawful, only subject to “risk of potential legal challenge,”94 illustrates this fact. Interviews with local experts and review of internal decision-making documents indicate that current lack of alternative rate structures is due to desire to avoid said potential legal challenge, rather than a past finding of unlawfulness.
Mich. Const. art. IX, § 31, commonly referred to as the Headlee Amendment, prohibits local governments from raising taxes without voter approval.95 In Bolt v. City of Lansing, the Michigan Supreme Court interpreted a storm water charge that exceeded the actual cost of service as a tax, invalidating it under the Headlee Amendment.96 The court devised a three-part test to differentiate between a tax and a fee, holding that:97
- A user fee is meant for regulation, while a tax generates revenues.
- A user fee must be proportionate to the necessary cost of service.
- Unlike taxes, fees should be voluntary, allowing users the right to refuse the use of a commodity.
The Detroit Blue Ribbon Panel on Affordability stated that the Bolt decision has generally been interpreted to require that water services be priced on the cost of service, rather than alternative rate structures potentially based on non-cost factors like income or ability to pay. However, there is considerable disagreement over the extent to which Michigan’s legal framework applies to alternative rate structures (as opposed to individual charges like the Bolt storm water charge).98
In July 2018, Oakland County Circuit Court Judge O’Brien ruled on a class action case brought on behalf of Bloomfield Township residents. The suit raised multiple issues, one of which asserted that some water and sewer service charges violated the Headlee Amendment. On this point, the judge ruled that there was no violation of Headlee.99
A series of other lawsuits in circuit court have had mixed results, with suits against Birmingham and Ferndale settling out of court and cases against Royal Oak and Holly dismissed in court in 2015 and 2016.100 A single law firm handled many of those cases and has several ongoing cases in Oak Park, Westland, Detroit, Dearborn, and Brighton Township.101 Oak Park has taken its case to the Michigan Court of Appeals.102
Beyond state law, federal laws and regulations expressly allow variable rate structures. EPA regulations state very clearly that grantees (local jurisdictions regulated by EPA) “may establish lower user charge rates for low income residential users after providing for public notice and hearing.”103 Further, EPA states that “[t]he costs of any user charge reductions afforded a low-income residential class must be proportionately absorbed by all other user classes. The total revenue for operation and maintenance (including equipment replacement) of the facilities must not be reduced as a result of establishing a low income residential user class.”104 In addition to regulatory permission, the EPA encouraged regional administrators and directors to consider alternative rate structures, saying that “[u]niform rate structures may place disproportionately high financial burden on households with low incomes. EPA Strongly encourages municipalities to consider establishing lower rates or subsidies for low income customers.”105 Therefore, the EPA not only allows, but expressly encourages, low-income alternative rate structures to be implemented, and to be paid for by spreading costs throughout the rest of the system’s ratepayers.
The Supremacy Clause of the United States Constitution declares that federal law supersedes state law when the two conflict.106 The United States Supreme Court has also clearly found in City of New York v. FCC that federal regulations, such as EPA’s, carry the force of federal law:
The phrase “Laws of the United States” encompasses both federal statutes themselves and federal regulations that are properly adopted in accordance with statutory authorization… we have also recognized that “a federal agency acting within the scope of its congressionally delegated authority may preempt state regulation” and hence render unenforceable state or local laws that are otherwise inconsistent with federal law.107
It has been asserted that because GLWA operates under an EPA NDLP permit and receives funding from EPA through State Revolving Funds, EPA regulations apply to the current context as interpreted by the Supreme Court in City of New York v. FCC. It is unclear if this avenue of argumentation has been raised any of the various state cases brought under Headlee/Bolt.
The active nature of state cases and potential avenues for higher level appeals, especially in the context of federal law, mean that the legal context of this topic is uncertain, and fear of legal challenge alone should not prevent further consideration of alternative rate policies, assuming that the long-term potential cost savings of rate reform are larger than legal fees.108
The federal government can also play a role in the design and implementation of affordability programs. For example, on June 6, 2018, Senator Kamala Harris introduced Senate Bill 3015, known as the Water Affordability Act. It would amend the Federal Water Pollution Control Act “to establish a low-income sewer and drinking water assistance pilot program...109 to provide grants to not less than 10 eligible entities to assist low-income households and environmentally at-risk households in maintaining access to sanitation services and drinking water.”110 The bill spells out qualifications for eligible entities and households. Eligible entities must be a municipality or public utility currently “affected by a consent decree.”111 Individuals eligible to receive assistance funded by federal government must be low-income (households at a particular income or enrolled in a number of existing assistance programs), or environmentally at-risk households in areas within 5 miles of an environmentally hazardous site or other area designated as at-risk by the EPA’s Environmental Justice Screen Tool, which uses both racial demographics and environmental risks.112
One way that utilities address affordability issues like those identified above is through Customer Assistance Programs (CAPs). The EPA has published a review of CAPs across the country and found that programs typically span five categories:113
- Bill Discount – reduces the bill, typically long-term
- Flexible terms – arrearage management, bill timing adjustment, payment plans, levelized billing (breaking annual or quarterly payments down to monthly)
- Lifeline rate – subsidized rate for a fixed amount of water for basic needs
- Temporary assistance – short-term or one-time assistance to prevent disconnection or assist with hardship
- Water efficiency – provide assistance for repairs and/or efficiency upgrades
Out of 795 utilities reviewed by the EPA, 228 offered some form of CAP.114 The EPA found that 42 percent of all CAPs were related to bill discounts, while 27 percent were included in flexible terms, and 24 percent applied for temporary assistance. Programs are often targeted based on income, permanent disability, temporary hardship, age, or veteran status.
In late-2015, the Detroit City Council convened a Blue Ribbon Panel on Affordability (BRPA) to study the issue. The panel was comprised of national and regional experts on public utilities, water, and affordability who came from academia, regional utilities, and practitioners. The panel published a report in 2016 detailing its findings.115 Because the panel spent considerable time investigating and ranking policy alternatives, this analysis will not repeat those efforts in full.
However, the panel’s report exposed serious disagreements among members,116 shortages of data and analysis,117 and was published before GLWA’s program meant to address affordability was launched.118 So far, this analysis has endeavored to provide additional data and empirical analysis to inform areas where BRPA and others have admitted open questions remain. The review of alternatives below will report on BRPA’s findings, adding new empirical evidence from the findings in preceding sections and evaluating GLWA’s assistance program that the panel was unable to review.
Customer Assistance Programs
The Water Residential Assistance Program by GLWA and DWSD
GLWA implements a CAP called the Water Residential Assistance Program (WRAP). Eligibility requirements for the program are:119
- Have income at or below 150 percent of the poverty threshold ($30,240 for a family of three)
- Install a new automatic meter-reading device
- Provide proof of residency and income
- Provide renter’s proof of responsibility for water on lease
- Have provided payment towards the account balance (either of 5 percent of amount owed or $50) within last 90 days
- Stay current on monthly bill payment
- Two-year limit to program participation
The benefits of the program to households are:120
- One-time home water audit for households above 120 percent of average water use
- Up to $1,000 for minor plumbing repairs
- Up to $300 per year in monthly bill credits ($25 per bill)
- Up to $700 per year in arrearage assistance
WRAP is funded by GLWA at a rate of 0.5 percent of budgeted revenues, with initial funding of $4.5 million for FY2016 (first year of the program), $4.7 million for FY 2017, and $4.9 million for FY2018.121
As of December 31, 2017, 68 of 103 eligible communities have opted into WRAP. Statistics on uptake rates in each community are not publicly available, as program implementation is reported in aggregate dollar amounts rather than household-level accounts and WRAP is administered by four different “community action agencies,” but Detroit’s program is reported to have served 8,000 households since March 2016, with 3,557 households currently enrolled.122 Detroit is also the largest community user of WRAP, with $297,856 allocated to conservation and $1,278,103 allocated to direct assistance in fiscal year (FY) 2017.123 This is larger than the nearest county-wide allocation (Wayne County minus Detroit) at $188,029 for conservation and $806,833 for direct assistance. The rest of this WRAP analysis section will focus on Detroit, given the size of its WRAP allocation and the dire needs of Detroit identified in the preceding section.
Limits of Available CAPs
Despite being touted as “extremely successful”124 and “comprehensive”125 by the GLWA and outside groups, internal documents from the GLWA paint a different picture. The WRAP Program Design Report notes that economic challenges faced by customers are major:
These needs extend well beyond the scope of the Water Residential Assistance Program…the scope and structure of [WRAP and possible assistance programs] pales in comparison to the endemic problems induced by persistent poverty in our communities.126
Additionally, the report acknowledges that WRAP is not intended to be comprehensive:
WRAP will provide support to a select number of families in need. Preliminary estimates indicate that 2,000 to 5,000 households will be provided assistance each year under WRAP…Assistance programs—implemented by GLWA and regional retail service partners—must therefore be regarded as limited, often frayed, threads in a social safety net that is tattered in many southeastern Michigan communities. WRAP and similar programmatic efforts offer stopgap measures that, at best, may contribute to residents’ abilities to establish pathways to economic stability.127
It must be noted that despite the size and laudable efforts of the GLWA’s CAP, the design of WRAP has several structural design choices that severely limit its ability to provide real impact:
- The two-year participation cap means that WRAP falls under the category of “temporary assistance,” rather than “bill discount,” which means that it does not address the demonstrated structural affordability issues that households, especially in Detroit, face. It will provide relief to households for two years and will address accounts in arrears, but nothing inherent to the program (aside from reduced water consumption through leak fixes and efficiency upgrades) will prevent households from eventually falling into arrears again after the eligibility cap is reached
- The fact that arrearages receive over twice the subsidy that current bill amounts receive ($700 per year vs. $300 per year) means that WRAP is more focused on assisting the GLWA in removing past due accounts, rather than addressing the current demonstrated affordability concerns. Reducing the backlog of arrearages is indeed necessary, but this characteristic of the program does not address the fundamental structural forces that lead to arrearages in the first place
- The requirements that a customer must have provided a minimum payment towards arrears in the past 90 days and stay current on monthly bills means that a significant but unknown population will not be able to partake in the program, despite likely being the neediest of the needy
- The parts of the program focused on reduced consumption (via usage audit or plumbing repairs) may assist customers in facing lower bills, but the accompanying reduced overall consumption and corresponding reduced revenue harms GLWA’s (or the local community’s) ability to fund the program and other capital investment costs
According to the American Community Survey's 2016 five-year census estimates, 140,469 households within Detroit fall under WRAP’s income eligibility threshold of 150 percent of the poverty line ($30,240 for a family of three). Limiting that number to owner-occupied units128 yields an estimated 67,674 households129 that have need for and would be income-eligible for WRAP.130 The 8,000 households already served indicate that WRAP has only touched (temporarily, given the two-year cap on benefits) 11 percent of the estimated actual need within Detroit.
Detroit residents also have access to additional CAP programs funded outside of GLWA and run by volunteers or the state of Michigan. These include:
- DWSD 10/30/50 Plan:131 a payment plan that spreads out arrearages over a longer time period to prevent immediate water shutoffs. A down payment of 10 percent of the current past due balance allows a customer to spread the remaining balance over a 24-month period. Missing one payment while enrolled requires a payment of 30 percent of the remaining balance to re-enroll and missing a second payment triggers a requirement of payment of 50 percent of the remaining balance to remain enrolled
- Water Access Volunteer Effort (WAVE) Fund:132 a nonprofit 501(c)3 organization founded in 2003 that provides emergency assistance to low-income households facing crises. The organization pays dollar amount needed to restore or maintain water (up to $500) for households that have had the water shut off or have received a shutoff notice. Assistance is limited to once per calendar year and is contingent on the household paying any remaining balance to DWSD.
- State Emergency Relief (SER) program: provides up to $175 per year in assistance to prevent water shutoffs for low-income households.133 The emergency “must threaten health or safety and… must be one that the payment can resolve and one which is not likely to happen again.”134
- Soldiers and Sailors Relief / Michigan Veteran Trust Fund:135 provides financial assistance to indigent veterans, military spouses, widow/widowers, or children of a war-time veteran. Assistance amounts vary
Given the current WRAP spending levels within Detroit and the number of households reached, it is clear that the WRAP Program Design Report was correct in asserting that WRAP is a stop-gap measure that plays a small but important role in addressing affordability, but is by no means comprehensive. Detroit residents do have access to additional CAPs beyond WRAP at both the state and local levels. However, each is severely limited in its own right, whether by funding (WAVE), eligibility restrictions (SER), personal characteristics (veterans programs), or lack of actual financial assistance (DWSD 10/30/50) and unlikely to fundamentally address the systemic drivers of unaffordability. These CAP programs are essential to assisting households with temporary “crises,” such as sudden healthcare costs or loss of a job, but are not designed nor sufficiently resourced to address structural lack of affordability.
Using the number of households that fall below WRAP’s income eligibility threshold of 150 percent of the federal poverty line ($30,240 for a family of three) calculated in the prior Analysis section and extrapolating WRAP cost per household from the Detroit data,136 it is possible to estimate the funding needed for WRAP to fully address the affordability problems across GLWA in the absence of any other policy change. Table 3 below shows the estimated amounts per year that would be needed to address the upper and lower bound estimates (based on the realistic and conservative specifications of the metric, respectively) of the number of households in each service area:
Table 3: Total Estimated Cost for WRAP Alone to Meet Unaffordability Needs
|Number of Households||Total Estimated Cost|
|Lower Bound Detroit||72,185||$31,977,955|
|Lower Bound GLWA||35,864||$15,877,752|
|Upper Bound Detroit||104,181||$46,152,183|
|Upper Bound GLWA||204,308||$90,508,444|
Given the current WRAP funding of $4.7 million for FY17 and the future yearly funding allocation of 0.5 percent of budgeted revenues, it is highly unlikely that WRAP alone would be sufficient to address the total need, even with additional infusions of funding.
Alternative Rate Structures
Alternative rate structures are another common way to address affordability concerns. These programs structure rates according to certain criteria so that different categories of customers pay varying amounts based on criteria inputs. A 2016 EPA survey of 795 utilities found that 228 offered some form of alternative rate structure.137
Income-Based Rate Setting
Income-based rate setting establishes costs for low-income households expressly on their ability to pay by setting rates as percentages of their income, in essence applying the metrics outlined above on a household-by-household basis. This type of rate has the benefit of targeting relief directly at those in need, which across-the-board discounts do not.138 Using a fixed credit approach in applying such rates would allow the program to work within a fixed and predictable operating budget. Drawbacks in the context of DWSD would be technical and staff limitations due to the need to redesign computer systems and business practices, which have been noted to be challenging and require time.139
Increasing Block Rates
Increasing block rates implement higher per-unit prices as usage volumes rise in accordance to set blocks of usage. The lowest block could be set at an affordable level targeted at low-income households, with higher price blocks achieving cost recovery for the utility while also promoting resource efficiency in water use.140 This would also require reconfiguration of computer systems and business practices.
Minimum Allowance / Lifeline Rate
Minimum allowance structures, sometimes called “lifeline rates,” provide a set minimum amount required for health and safety at a fixed charge (set to an affordable level) without applying volumetric charges at all at the minimum. Any consumption above that amount would be subject to traditional rates adjusted to cover the cost of the lower fixed charge for the minimum allowance. This alternative does not have the administrative burdens of other alternatives since the minimum allowance does not require separate billing routines or rate schedules based on customer class.141
Blue Ribbon Panel Evaluation Results and Interpretation in Updated Environment
The Blue Ribbon Panel assessed alternatives based on evaluation criteria including:142
- Risk of potential legal challenge
- Extent of assistance: number of households
- Extent of assistance: durability
- Resource Efficiency
- Implementability / Understandability
Each alternative was ranked on a scale of one to 10 on each of the criteria. Composite scores and rankings were calculated for each panel member, across different criteria weightings, and for each of the panel member categories (DWSD officials or experts).
The panel found increasing block rates to perform best among all scorers, followed by minimum quality allowance and income-indexed rates, and ended up formally recommending an increasing block rate structure.
It should be noted, however, that in the weighting structure of the various criteria the Blue Ribbon Panel gave heaviest impact to Risk of Potential Legal Challenge (25 percent), followed by Extent of Assistance (both Number of Households and Durability at 20 percent), Fairness (15 percent), Implementability/Understandability (15 percent), and Resource Efficiency (5 percent). Weighting Risk of Legal Challenge highest out of all criteria is understandable from the perspective of administrators wanting to be conservative and avoid unnecessary costs, however given recent developments to the legal landscape this decision seems suspect, especially in light of new empirical evidence on the extent of unaffordability in the region and small impact of WRAP (relative to the size of the problem).
Increasing the weight of the Durability criteria and deflating the weight of the Risk of Legal Challenge criteria seems like an appropriate compromise, since Durability represents the conservative drive of administrators to ensure that any affordability program is sustainable in the long term (by keeping customers able to pay and saving utility costs from collection activity, managing arrearages, and shutoff/turnon activities143) and addresses structural drivers of unaffordability. Since the individual panel member scores are noted as being subjective144 and take into account the legal and affordability landscapes as they were understood at the time, this report will not attempt to recalculate the scores according to a different weighting, as the underlying scores pre-weight would likely change with the new information as well.
Compared to the status quo, any of the rate alternatives, income-based, fixed charge, or inclining block rate, would go a long way to address structural unaffordability that is not fundamentally addressed by existing time-limited and underfunded CAPs. Income-based rate structures, in particular, would ensure that benefits are targeted at those who need them, assisting households unable to pay while also minimizing cross-subsidies required to pay for it. At the same time, increasing block rates and lifeline rates may be easier to administer by the utility. No matter which is chosen, an alternative rate structure is necessary. CAPs treat symptoms of unaffordability, but alternative rate designs would treat the root causes.
- 93. “We conclude that the fixed charge proposed for the Detroit Water affordability program meets both exceptions to the Headlee Amendment. It is a valid component of a user fee for water service, not a tax, under Bolt. And, regardless of whether it is a tax or fee, the discretion of the Board to implement affordability measures in its rate design predates the Headlee Amendment by over a century, and therefore is exempt from the Amendment as interpreted in American Axle.” Sean Flynn, Constitutionality of Water Affordability Program for Detroit (Wash. D.C.: Spiegel & McDiarmid, Sept. 26, 2005).
- 94. Blue Ribbon Panel, Final Report, 4.
- 95. Mich. Const. art. IX.
- 96. Bolt v. City of Lansing, 587 N.W.2d 264, 279-81 (Mich. 1998).
- 97. Id.
- 98. Blue Ribbon Panel, Final Report, 12.
- 99. Youmans v. Charter Township of Bloomfield, “Plaintiff’s First Amended Class Action Complaint,” (Mich. Ct. Ap. 2016), case no. 2016-152613-CZ, http://kickhamhanley.com/files/Youmans%20v%20Bloomfield/Plaintiff's%20First%20Amended%20Class%20Action%20Complaint%20(KH148925x9ECC1).pdf, accessed March 17, 2019; Anne Runkle, “Trial Over Bloomfield Township Water Bills Wrapping Up,” Oakland Press News, February 27, 2018, http://www.theoaklandpress.com/general-news/20180227/trial-over-bloomfie... Lisa Brody, “Split Decision in Water, Sewer Suit Against Township,” Downtown News Magazine, July 20, 2018, https://www.downtownpublications.com/single-post/2018/07/20/Split-decisi... Lisa Brody, “Plaintiffs Awarded $3.8 Million in Water Suit,” Downtown News Magazine, September 7, 2018, https://www.downtownpublications.com/single-post/2018/09/07/Plaintiffs-a....
- 100. Crystal Proxmire, “Lawsuit Dismissed Against Village of Holly over Water and Sewer Fees,” The Oakland County Times, December 12, 2017, http://oaklandcounty115.com/2017/12/12/lawsuit-dismissed-against-village....
- 101. Anne Runkle, “Bloomfield Township Supervisor ‘Confident’ that Lawsuit over Water Sewer Charges will be Dismissed,” Oakland Press News, June 28, 2017, http://www.theoaklandpress.com/general-news/20170628/bloomfield-township....
- 102. Anne Runkle, “Oak Park Vows to Take Fight Over Water, Sewer Charges to Michigan Court of Appeals,” Oakland Press News, June 28, 2017, http://www.theoaklandpress.com/general-news/20170628/oak-park-vows-to-ta....
- 103. 40 C.F.R. §35.2140(i)(1) (2015).
- 104. Id.
- 105. Id.
- 106. U.S. Const. art. VI, § 2.
- 107. City of New York v. FCC, 486 U.S. 57 (1988).
- 108. The cost of shutting water off alone for Detroit totaled $5.6 million between 2013-2014 (Board of Water Commissioners “Contract No. DWS-894: Water Shut-off/Turn-on Project” April 24, 2013), and $7.8 million between 2018-2021 (Lara Moehlman, “Over 17,000 Households Could Face Water Shutoffs in Detroit,” Michigan Radio March 26, 2018). Staff time and resources devoted to collections and arrearage management is also a considerable cost, although no public estimate exists. It is not unreasonable to find these costs greater than that of a legal challenge, especially when savings from removing them are accounted for over the life of such a policy change relative to a finite legal case (including time discounting principles from benefit-cost analysis.)
- 109. S. 3015, 115th Cong. (2018). Available at https://www.congress.gov/115/bills/s3015/BILLS-115s3015is.pdf, accessed March 17, 2019.
- 110. S. 3015, 115th Cong. § 124(b)(1). Available at https://www.congress.gov/115/bills/s3015/BILLS-115s3015is.pdf, accessed March 17, 2019.
- 111. S. 3015, 115th Cong. § 124(a)(1). Available at https://www.congress.gov/115/bills/s3015/BILLS-115s3015is.pdf, accessed March 17, 2019.
- 112. S. 3015, 115th Cong. §§ 124(a)(1)-(b)(1). Available at https://www.congress.gov/115/bills/s3015/BILLS-115s3015is.pdf, accessed March 17, 2019.
- 113. US EPA Water Infrastructure and Resiliency Finance Center, Drinking Water and Wastewater Utility Customer Assistance Programs (US EPA, April 2016), https://www.epa.gov/sites/production/files/2016-04/documents/dw-ww_utili....
- 114. US EPA Water Infrastructure and Resiliency Finance Center, Drinking Water and Wastewater, 7.
- 115. Blue Ribbon Panel, Final Report.
- 116. Blue Ribbon Panel,12, 21, 23.
- 117. Blue Ribbon Panel, 25.
- 118. Blue Ribbon Panel, 7.
- 119. Great Lakes Water Authority, Water Residential Assistance Program (WRAP) Opportunities, June 6, 2017, https://outreach.glwater.org/LinkClick.aspx?fileticket=8tNKy2oZeyQ%3D&ta... “Community Action Alliance WRAP,” Wayne Metro, accessed March 16, 2019, http://www.waynemetro.org/wrap/.
- 120. GLWA offers WRAP to individual communities. Individual communities must sign up to receive funds to then distribute to individual households that meet eligibility criteria. Communities have the option of engaging WRAP at one of three “Option Levels” with varying benefits to households. Option 1 includes the benefits listed above. Option 2 includes all but arrearage assistance, and Option 3 includes everything but arrearage assistance and bill credits.
- 121. Great Lakes Water Authority Audit Committee, GLWA Audit Committee Meeting e-Binder (GLWA, April 2018), https://www.glwater.org/wp-content/uploads/2018/08/GLWA-Audit-Committee-.... GLWA, 2017 Year in Review.
- 122. Stafford, Controversial Water Shutoffs.
- 123. GLWA Audit Committee, Audit Committee Meeting e-Binder.
- 124. GLWA, 2017 Year in Review.
- 125. UNC Environmental Finance Center, Navigating Legal Pathways to Rate-Funded Customer Assistance Programs (Chapel Hill, NC: UNC School of Government, 2017), https://efc.sog.unc.edu/sites/default/files/Pathways%20to%20Rate-Funded%....
- 126. WRAP Advisory Group, Program Design Report.
- 127. Id.
- 128. Assuming that only owner-occupied units directly pay water bills, although water costs do still indirectly impact rental prices and cost of public housing. This assumption is necessary to give a conservative estimate, but it is true that there are a proportion of renters who do directly pay water bills. Unfortunately, it is noted in the literature on this topic that identifying the proportion of renters who face costs directly is incredibly difficult, given data limitations.
- 129. Households below 150% of poverty line calculated from ACS tables B19001 and B25003 by summing households in income groups below $29,999 and scaling that value by the percentage of owner-occupied units.
- 130. See Analysis section above for estimates of the number of households residing in census tracts that breach the 4.5% affordability metric threshold both inside and outside of Detroit. These households would likely require WRAP assistance in the absence of an alternative rate structure.
- 131. Detroit Water and Sewerage Department, DWSD 10/30/50 Plan (Detroit, MI: City of Detroit), accessed March 16, 2019, http://www.detroitmi.gov/Portals/0/docs/DWSD/DWSD_PlanFlyer.pdf.
- 132. “Eligibility Requirements,” Water Access Volunteer Effort, accessed March 16, 2019, https://www.wavefund.org/elgibility-requirements.
- 133. “How do I Keep my Water Flowing?” City of Detroit, accessed March 23, 2019, https://detroitmi.gov/departments/water-and-sewerage-department/bill-ass....
- 134. “MDHHS Can Help with Temporary Assistance,” Michigan Department of Health and Human Services, accessed March 16, 2019, https://www.michigan.gov/documents/dhs/DHS-PUB-0783_233434_7.pdf.
- 135. City of Detroit, How do I Keep my Water Flowing?
- 136. Total WRAP funding for Detroit divided by the number of enrolled households: $1575959 / 3557 = $443.06
- 137. US EPA Water Infrastructure and Resiliency Finance Center, Drinking Water and Wastewater, 7.
- 138. Roger Colton, A Water Affordability Program for the Detroit Water and Sewerage Department (Belmont, MA: Fisher, Sheehan, & Colton, 2005), https://drive.google.com/file/d/0BxDX326T9LRxSGRHQUdTamlUekk/view.
- 139. Blue Ribbon Panel, Final Report,16. Note that the report indicates DWSD claimed to need two or more years to update systems and business practices to facilitate updated billing practices. The present report is being published just over two years after the Blue Ribbon Panel report, so it is a proper time to revisit alternatives.
- 140. Blue Ribbon Panel,17.
- 141. Id.
- 142. Blue Ribbon Panel, 20-24.
- 143. These are commonly referred to as the “business case” for affordability programs.
- 144. Blue Ribbon Panel, 44.