Panel on New Bill Payment Assistance Program for Low Income Water Customers

1. Water Affordability in
Philadelphia
Robert W. Ballenger
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2. Questions to Consider
• What is the need?
• What is “affordable?”
• What have we done (and possibly learned
from)?
• What are we doing?
• What are we going to do?

3. Immense Need for Assistance
• Philadelphia demographics
• Low-income program participation for electric
and gas utilities, compared to water
• Water bills rising
• Nationwide recognition

4. Impacts of Inadequate Assistance
• Health/safety
• Shut offs
• High rate of default
• Collection issues
• Bad debt

5. Defining Affordability
• Comparing bills as a percentage of income
– An average bill represents 2.19% of the median
Philadelphia household’s monthly income,
– For the approximately 14.8% of Philadelphia households
having income below $10,000 per year, such an average
bill represents at least 8.1% of monthly income,
– For the approximately 8.3% of Philadelphia households
having income between $10,000 and $14,999 per year,
such an average bill represents at least 5.4% of monthly
income,
– For the approximately 13.4% of Philadelphia households
having income between $15,000 and $24,999 per year,
such an average bill represents at least 3.24% of monthly
income

6. Defining Affordability (Cont.)
• What measure do we use?
– FPL
– AMI
• How do we define whose income is low
enough and whose income is not low enough?
• How do we calculate affordable bills?
• What do we do about arrears?

7. Other Utilities/Studies
• PUC context: CAP policy statement
– Fixed percentage of income targets for
affordability
• PGW model
• PECO model – past and present
• Current WRAP model

8. Benefits of Affordability
• Improved payments
• Reduced debt
• Increased “netback”
• Utility financial benefits
• Community benefits

9. New Program for Philadelphia Water
• Program design
– Systematic approach
– “Monthly bills shall be affordable for low-income
households”
– “Monthly bill calculations based on income”
– Conservation treatment
– Arrearage management
– Ongoing monitoring

10. New Program (cont.)
• Program timeline
– Upcoming rate case
– Implementation
– Enrollment