The 2019 North Carolina Water and Wastewater Rates Dashboard was deployed just over a month ago, marking another year in a long partnership between the Environmental Finance Center at UNC-Chapel Hill, the North Carolina League of Municipalities, and the North Carolina Division of Water Infrastructure. One of the benefits of such a long and successful partnership is the wealth of historic rates data.
The Rates Dashboard provides an up-to-date look at rates and financial sustainability indicators for utilities around the state, but it is merely a snapshot. By looking at trends in rates and demographic factors, such as income, the numbers and changes start to tell a story. A trends analysis was produced for a recent course on Water and Wastewater Finance at the UNC School of Government, looking at rates from 2009-2018, EPA SDWIS Service Population data from 2009-2018, and income, from US Census American Community Surveys, from 2007-2017. The figures below are adapted from that analysis. The analysis is restricted to utilities that have participated across all years and availability of data. By looking at the overall trend rather than the specific values, the resulting patterns can provide considerations for utilities across the state. Continue reading
At the Environmental Finance Center, we think a lot about the affordability of environmental services such as drinking water and wastewater. Historically, many systems have measured affordability by looking at the cost of service compared to a community’s median household income (MHI), though this measure is limited. A better way to measure affordability is to look at the cost of service over a range of income buckets.
All of these measures, however, are looking at affordability through the lens of annual income. That can be a good measure if households only have regular expenses. But what happens if a household has an unexpected expense? Would that household be able to cover its regular costs if it had an emergency expense? Continue reading
“Won’t you pay my bill?” is a question that the water utility asks of the customers who do not pay their water, wastewater, and even stormwater bills. But low-income customers are, essentially, asking the same question: will you—higher income customers—help pay the water bills of the poor?
National organizations like the American Water Works Association have policies related to non-payment. AWWA says “[f]ailure on the part of the customer to pay a water bill for services rendered necessitates that other customers bear the costs associated with the non‐payment of water service.”
But is it worth it to the water utility to use the rate revenues from one group of customers to subsidize the rates of another group of customers via an assistance program? More than that, is it even legal? Continue reading
It’s college football season again, and thoughts among many in the South, and elsewhere, turn to tailgating and touchdowns, hot dogs and sodas, field goals and fun. (Here in Chapel Hill, we like to remember alumnus Andy Griffith’s famous 1953 comical monologue about football, “What It Was, Was Football.”) Meanwhile, those of us at the UNC Environmental Finance Center (EFC) have completed our first-ever Alabama Residential Water and Wastewater Rates Dashboard, which, in fact, ties in with – you guessed it – football! (As well as tying in with the affordability of water and sewer bills by customers in Alabama, of course.) Continue reading
Jeff Hughes is a Faculty member at the UNC School of Government and the Director of the UNC Environmental Finance Center. Jeff is also the Principal Investigator for the Water Research Foundation’s “Defining a Resilient Business Model” Project (#4366).
Conventional wisdom among many water managers is that the price of water and wastewater service is a bargain and customers should not have difficulty paying their bill. Even in areas with higher priced water services, managers seek solace in the fact that the price of water services still tends to compare favorably to the price of non-essential services such as cable. These views can be supported in most service areas by citing the most common affordability metric, the percentage of a community’s annual median household income (MHI) spent on water services over a year.
Despite the challenges in calculating it, percent of MHI spent on water is Continue reading