Barriers to Assisting Customers When Water Rates are Not Affordable

Transcription

1 Barriers to Assisting Customers When Water Rates are Not Affordable Jeff Hughes, Director Environmental Finance Center, School of Government University of North Carolina at Chapel Hill

2 Dedicated to enhancing the ability of governments and other organizations to provide environmental programs and services in fair, effective, and financially sustainable ways through: Applied Research Teaching and Outreach Program Design and Evaluation

3 Some of the many barriers to universal affordability: Increasing revenue needs Household incomes for many stagnant or falling Lack of national or state level assistance programs Challenges to funding local customer assistance programs.

4 Research Funders Steering Committee Research Team Independent Legal Experts Scott Rubin, Advisor Roger Colton, Advisor

5 Can a Utility Use its Primary Revenue Source (Rate Revenue) to Fund a CAP? 52 state/territory legal snapshots Nine case studies of well funded customer assistance programs Analysis of other sector approaches Analysis of international approaches

6 Navigating Legal Pathways to Rate-Funded Customer Assistance Programs

7 The Few and the Proud California Water Services Great Lakes Water Authority Service Area Seattle Public Utilities.

8 Confusing and Ambiguous Legal Framework Utilities must navigate a complex, confusing and ambiguous legal framework that varies significantly from state to state In many cases, different types of utilities are subject to different rules e.g. in California: Government owned utilities = Rate funded CAPs curbed by restrictive statutory and constitutional provisions Investor owned utilities = Rate funded CAPs encouraged

9 Subject to interpretation.

10 Clear sailing for only a few. Examples: Washington State: created specific laws that outline how these programs can be created States such as California, Kansas, Kentucky, and Nevada have also been clear that at least some group of water and wastewater utilities can use rate revenue to fund CAPs States such as Indiana have softened language and provided clearer paths forward for these programs

11 Categorizing States by Level of Authorization for Affordability Programs Using Rate Revenue Explicitly Authorized No Express Authority Potential for Challenges Specifically Prohibited

12 Commission Regulated Utilities: Ability to Implement CAPS Funded by Ratepayer Revenues by State

13 Non Commission Regulated Utilities: Ability to Implement CAPS Funded by Ratepayer Revenues by State

14 Options for Moving Forward if Authority is Prohibited Vaguely 1. Introduce statutory language that addresses rate funded CAPs in clear, unambiguous terms 2. Develop an argument for why a CAP conforms to existing statues and is not affected by perceived limitations 3. Develop an alternative program that does not rely on direct customer rate revenue to fund the assistance to low-income individuals

15 For More Information Jeff Hughes Environmental Finance Center University of North Carolina at Chapel Hill