Tag: covid-19 (Page 1 of 3)

Trends in utilities’ financial condition reveal early effects of the pandemic

At the start of the pandemic, there was uncertainty about how water and wastewater utilities’ revenues and finances might be affected. Many utilities and local governments were concerned with loss of revenue from the commercial sector, as well as the financial implications of statewide moratoria on late fees and disconnections for non-payments designed to ensure that everyone has adequate access to water and sanitation during a designated public health emergency. Various polls and case studies were analyzed to gauge early and ongoing effects on the utilities’ financial condition. Now, the release of audited data in local governments’ annual financial statements provides additional information and insights. This blog post summarizes how over 300 local government water and wastewater utilities in North Carolina fared at the end of Fiscal Year 2020 (end of June 2020 for all local governments in the state) compared to previous years. The audited data include the first three months of the pandemic.

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Water Bill Payment Assistance in Multiple Federal Coronavirus Relief Programs

At the time of this writing, Congress is debating passing another economic stimulus bill to provide relief against the COVID-19 pandemic. As the pandemic created hardships throughout the country for a year, the U.S. government passed two stimulus bills in 2020 that created or funded multiple financial relief programs for various needs. While there is no program that specifically provides relief to water and wastewater utilities’ losses in revenue, there are several programs funded through the two federal relief bills that can help customers pay past due or current water and/or wastewater bills (“water bills” for short). Water bill payment assistance relieves some of the financial burden on customers that are in most need, and also provides utilities needed revenues to cover unpaid bills and prevent shutoffs in many cases. While there is financial assistance to pay water bills, the fragmentation of the programs can be complicated to navigate. This blog post provides a summary and links to our new factsheets that describe several federally-funded coronavirus relief programs to date that may be used to pay water bills. Information about where customers can go for help is provided.

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Ongoing Impacts of the COVID-19 Pandemic Conditions on North Carolina’s Water and Wastewater Utilities

Over the past 6 months*, the EFC has continued to investigate how utilities across NC are faring as the ongoing pandemic continues to create a variety of challenges related to revenue and operations. The big picture takeaway is that some things are improving while some things remain the sameMany utilities continue to feel a variety of impacts from COVID-19 on utility revenues and practices, some utilities are transitioning to pre-pandemic billing practices, and some utilities will be providing funds for bill payment assistance to customers who have past due bills.   

This week, the EFC is releasing a report, funded by the NC Policy Collaboratory, that details some of the on-going impacts on water and wastewater utilities that have resulted from COVID-19 and the implementation of NC’s Executive Orders 124/142which prohibited disconnection of residential customers and mandated the establishment of payment plansAs part of its research, the EFC interviewed staff from 16 different utilities and collected survey responses from a total of 34 utilities between August and December 2020. This research included utilities across the state that varied in size from 42-300,000 accounts and which had a wide variety of financial health characteristics. 

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Disconnections – Where’s the data?

On October 5th, two House Democrats, Harley Rouda and Rashida Tlaib, submitted this letter to ask the director of the CDC to give a nation-wide moratorium on water disconnections due to non-payment through the state of emergency because of COVID-19. While this is at the federal scale, many individual utilities and states already declared moratoria in 2020, though some of those have expired by now (mid-October). Utilities and state and local government officials recognize the value of access to clean and safe water during the pandemic, and utilities are motivated to avoid disconnections for public health and customer service reasons, as well as to minimize the cost of operations associated with disconnections and reconnections. Still, disconnecting a customer from water service is seen as an important tool for revenue collection in the water/wastewater industry. According to data from 84 North Carolina water and wastewater utilities provided to the North Carolina Utilities Commission, an average of 13.7% of a utility’s customers were past due on their bill in June of 2019 (pre-COVID). Providing notice of disconnection or disconnection itself can be effective for encouraging payment of these late bills, but how effective they are is unclear.

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Yadkin Valley Sewer Authority: A Case Study of the Impact of COVID-19 on a North Carolina Wastewater Utility

The abrupt arrival of COVID-19 in the United States financially impacted businesses across all sectors, with water and wastewater utilities being no exception (see our previous blog post). Two major factors influenced revenue streams for utilities in the state. The first was Executive Order 124/142 issued by Governor Cooper on March 31st, which prevented utilities from disconnecting water or wastewater services to residential customers due to missed payments. This moratorium extended until the end of July. The second factor was that many commercial, industrial, and institutional customers reduced or stopped their operations in line with the statewide stay-at-home order. For some communities, non-residential customers use the greatest share of water or wastewater. The utilities in these areas were at risk of significant revenue declines due to these customers ceasing operations.

We know there are a wide range of financial impacts on utilities during the pandemic depending on the size and composition of each utility’s customer base. By diving deep into a case study of one utility, we can better understand the specific effects that some systems across the state have been experiencing. At the EFC, we’ve been working with the Yadkin Valley Sewer Authority (YVSA) since the beginning of the pandemic to assess their financial condition and provide technical assistance. Using data and interviews they’ve provided, we are able to share a case study of their experience over the past year and how they are preparing for the future. Continue reading

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