Why Water or Wastewater Utilities in Many States May Be Apprehensive to Fund Affordability Programs with Rate Revenue
One of the reports recently completed at the Environmental Finance Center at the University of North Carolina at Chapel provides an analysis of the legal and policy environment surrounding rate-setting for water and wastewater utilities in all fifty states, as well as Puerto Rico and the District of Columbia. The report, Navigating Legal Pathways to Rate-Funded Customer Assistance Programs, attempts to answer the question of whether, state by state, water and wastewater utilities can implement assistance programs for low-income customers, where these programs are funded with rate revenue. However, after researching and drafting the summaries for each state, the black and white answers we were looking for, have turned out to be in fact, mostly gray. That is, in most states, there is not a clearly defined path that water and wastewater utilities can follow to legally fund affordability programs with rate revenue. Thus, despite the importance of ensuring affordable water for all, there are many utilities which don’t have these types of cross-subsidized affordability programs, perhaps, in part, due to this legal uncertainty. So why are some states black and white, while others remain gray?