Title
Resolution of Support for Water Affordability Bills Sponsored by Senator Stephanie Chang
Body
Agenda of October 18, 2023
Item No. 2023-238
TO: The Honorable
Board of Water Commissioners
City of Detroit, Michigan
FROM: Debra N. Pospiech, Chief Administrative Officer
Water and Sewerage Department
RE: Water Affordability Legislation Introduced by Senator Stephanie Chang
MOTION
Upon recommendation of Gary Brown, Director, the Board of Water Commissioners for the City of Detroit Water and Sewerage Department approves a Resolution to Support the Water Affordability Bills Sponsored by Senator Stephanie Chang, as set forth herein, and also authorizes the Director to take such other action as may be necessary to accomplish the intent of this vote.
RESOLUTION
WHEREAS, on October 3, 2023, Michigan State Senator Stephanie Chang and others introduced a series of bills to the Michigan Senate which, if enacted, would implement a multi-pronged approach to ensure that Michigan low-income residents who are unable to afford their entire water bill and who ask for help receive an affordable bill based on household income and avoid water shut-offs for non-payment; and
WHEREAS, water providers across the state require stable revenues to perform infrastructure investments that are vital to protect public health and safety, such as maintenance, repair and replacement of aging infrastructure, building climate resiliency to prevent sewage backups into basements and overflows into natural waterways, and removal of lead service lines; and
WHEREAS, poverty is persistent all across Michigan and there will always be customers who have trouble contributing to the much needed investments in our water infrastructure to provide quality service, which affects the entire population; and
WHEREAS, SB 550 would create a low-income water residential affordability fund within the state treasury, which will be used to implement a residential water affordability program as funding permits and pay the difference between the original bill and the discounted rate under the affordability program, pay off arrearages, and pay for plumbing repairs; and will be funded by a $2 per month fee on retail water meters; and
WHEREAS, the proposed $2 per month fee is no different than the MEAP/LIHEAP program for gas and electric utilities, which was established by the Snyder Administration and a Republican-controlled legislature; and water service is more vital than gas or electricity for public health and safety; and
WHEREAS, all customers currently cover the debt of customers who do not pay, through the “bad debt expense” which is incorporated into rates the following year; and
WHEREAS, the $2 fee to fund the water affordability program ensures that low-income customers pay a portion of their bill which will help reduce the bad debt expense and support infrastructure improvements; and
WHEREAS, SB 549 would create a state-administered low-income water residential affordability program under which qualifying individuals who apply for the program would not pay more than 3% of their household income on their water bill based on available funding; and would allow water providers with qualifying programs to administer their own program and receive funds from the low-income water residential affordability fund to support their programs; and
WHEREAS, small water providers throughout the state do not have the ability to offer water affordability programs, and larger water providers do not have sustainable funding for their programs, like Lifeline or WRAP, without jeopardizing revenues needed for vital infrastructure projects, so these pieces of legislation protect customers who rely on water service from any size provider in Michigan; and
WHEREAS, SB 551 would create the “water shutoff protection act,” which would require water providers to give various forms of notice to residential customers prior to water shutoffs, prevent water shutoffs for individuals enrolled in the low-income water residential affordability program, and offer wraparound triage services if enrollees do not or are unable to make payments; and
WHEREAS, the City of Detroit Board of Water Commissioners has long recognized its responsibility to ensure the Water and Sewerage Department remains financially stable and in compliance with all regulations, while protecting public health and safety for the entire community and the region, and believes Senate Bills, 549, 550 and 551 support and advance those responsibilities;
NOW, THEREFORE BE IT RESOLVED, that the City of Detroit Board of Water Commissioners hereby strongly urges the Michigan Legislature to pass Senate Bills 549, 550, and 551; and
NOW BE IT FINALLY RESOLVED, that this Resolution be sent to Mayor Mike Duggan, the Board and Chief Executive Officer of the Great Lakes Water Authority, and the majority and minority leaders of both the Michigan State House and Senate, in addition to Governor Gretchen Whitmer.