Managing the $638 million low-income water & sewer assistance in the federal COVID relief package
As frequent readers of this page likely know, the COVID relief bill that Congress passed in December included $638 million for low-income water and sewer bill assistance. Despite its high-falootin’ mouthful of a name, the Low-Income Household Drinking Water and Wastewater Emergency Assistance Program (LIHDWWEAP?*) has the feel of a last-minute provision tossed into the package. The $638M program got just 1.5 pages in Section 533 of the mammoth 5,593 page law, with little guidance on how the program will be structured or administered. Meanwhile, a new presidential administration has just taken office and is still trying to get organized. Advocates, regulators, and water sector managers are puzzled about how to manage the program and what it might mean for future federal forays into water affordability; I’ve been fielding lots of calls and messages on this issue over the past month.
Frequent readers also know that there are good reasons to be sober in our expectations of how much means-tested assistance can really help water affordability. But means-tested assistance is what Congress has cooking, and it's a useful part of an affordability strategy. So here I’ll do my best to summarize what we know about LIHDWWEAP (I’m going to call it LĬD-wēp , or LID-weep) administration and offer some ideas to the people charged with putting it into action.
Section 533 doesn’t say much about how LIHDWWEAP is supposed to work, but here are the basics. The program is to be administered by the Department of Health and Human Services (HHS), not EPA. That’s important because HHS already runs LIHEAP, the federal Low-Income Home Energy Assistance Program; Congress probably figures water utilities are a lot like energy utilities.**
HHS will not administer LIHDWWEAP directly. Rather, the program is structured as a set of grants to state and tribal governments. HHS is supposed to allot grants to each state and tribe based on the size of their populations under 150% of federal poverty levels and the share of the population that spends more than 30% of monthly income on housing. HHS hasn’t yet set the allotment formula, and it’s going to take at least several months of rulemaking before a dime gets to the states.
In turn, state governments will send funds to water utilities. Each state will have its own method for allocating funds to utilities and rules for the use of those funds. Section 533 says only that LIHDWWEAP is supposed to reduce water bill debt or service rates for “low-income households, particularly those with the lowest incomes, that pay a high proportion of household income for drinking water and wastewater services.” The law does not define “low-income” or “high proportion.” Section 533 directs HHS to use existing administrative procedures to the extent possible, but ultimately it will be up to water and sewer utilities to get the LIHDWWEAP money to the people who need it.
Congress just told HHS, hundreds of state and tribal agencies, and tens of thousands of utilities to provide means-tested assistance for low-income water/sewer customers. To be blunt, nobody really knows how to do that. Many utilities currently provide means-tested assistance or rate reduction programs, but to my knowledge there has never been a systematic study of U.S. water assistance program design, implementation or impact.† We’re more or less flying blind here.
All I can say definitively about LIHDWWEAP implementation is:
Having said that, I’ve worked with lots of utilities, I've seen a lot of assistance programs, and I know some things about water rates and public management. So with all appropriate caveats, here are some thoughts on how to implement the version of LIHDWWEAP that Congress just created. In crafting these educated guesses, I assume that state agencies and utility managers want to help low-income people as quickly and effectively as possible, and that strategic positioning for future LIHDWWEAP is a secondary concern.
Counsel for state administrators
Once HHS determines your state’s LIHDWWEAP allotment:
- Use a simple formula to allocate funds. Don’t bother trying to gather data on arrears or water debt and run sophisticated analyses to see which utilities “need” the most funding. That will take time and require data that lots of utilities can’t get readily, and funding is pretty meager anyway (it works out to about $10 for every person in the U.S. with income under 150% of poverty) so complexity would just slow things down. Just distribute funds to utilities as a function of service population and poverty rate. Where water and sewer services are offered by different organizations, just split them in half. No need for fancy allocation methods.
- Build a two-tiered system. Your state has hundreds of water and sewer utilities. A few of them are large, serving tens of thousands to maybe more than a million people. Those big utilities are professionalized organizations with hundreds to thousands of employees. But most of your state’s water and sewer utilities are very small, serving populations of less than 10,000 and employing fewer than a dozen people—maybe just one or two part-timers. Set up separate LIHDWWEAP implementation processes for big and small systems. The right size cut-off will vary from state to state, but I’d suggest a threshold of something like 50,000 in service population.
- Give big systems funds and get out of the way. Those large utilities probably have pretty good billing and accounting systems to track water/sewer debt, and they have a good idea how many customers may need assistance—lots of big utilities already have means-tested assistance, debt forgiveness, or rates in place. Send these big utilities their share of the LIHDWWEAP funds and let them use existing programs or create locally-tailored systems to get funds to customers who need it. Ask for a simple one-page report at the end of the year to tell you how they spent the money and how much they have left.
- Set up third-party administration for small systems. Your state’s small utilities already have a lot on their plates. Many have antiquated billing systems—maybe even paper ledgers—and poor or hard-to-manage account records. Most won’t have the organizational bandwidth to do the accounting, auditing, and reporting for LIHDWWEAP, let alone the capacity to handle means-testing. Even moderately-sized utilities (serving say 25,000) will not want to invest in administration of a LIHDWWEAP program that isn’t very generous. Instead, allocate funds to small systems, and then set up boilerplate memoranda of understanding (MOUs) that pool the small systems’ funds into funds to be administered by regional or county-level social service agencies that already manage means-tested programs. Allow funds to be distributed to any income-qualified resident of the small systems’ service areas. Don’t bother tying back benefits to specific bills or water debts.
Counsel for utilities
Once your state administrator allocates your LIHDWWEAP funds, they will probably come with some rules. Everything that follows carries the caveat: “…if state and federal regulations allow.”
- Use existing programs. If you already have a means-tested assistance or discount program that seems to work, just funnel the LIHDWWEAP funds into it and expand outreach and eligibility as much possible. In many cases the new program won't give very much money. Many existing programs target specific segments of the population (e.g., elderly, disabled); these should be expanded to include any income-qualified customers.
- Focus on shut-offs. If you don’t already have a means-tested assistance/discount program or your program doesn’t work very well, use LIHDWWEAP funds to manage (preferably eliminate) shut-offs for nonpayment. Setting up, publicizing, and administering an effective assistance program takes a lot of time. To help people right away, stick the LIHDWWEAP money into a dedicated account. When a residential customer account falls into serious delinquency and is at risk of shutoff, contact the customer and ask if (s)he qualifies for assistance by whatever guidelines are adopted locally. Make that process as easy as possible. If a customer slated for shut-off qualifies, just use the LIHDWWEAP funds to pay off the debt and maintain service. You can do this literally up to the moment when the utility crew shows up to shut the water off (but preferably earlier). Once a permanent assistance/discount program is up and running, any remaining LIHDWWEAP funds can supplement it.
- Work together. All of this stuff is easier to manage in larger organizations. If your utility doesn’t have the organizational capacity to take on LIHDWWEAP administration, cooperate with other utilities and/or organizations in your area to save on administrative costs while helping your customers in need.
LIHDWWEAP might have been a congressional afterthought jammed into an overstuffed emergency relief package, but it portends more federal water assistance to come. LIHEAP-style assistance seems to be the congressional Democrats’ preferred instrument for addressing water affordability. Congress and HHS will be watching as states and utilities grope toward administrative processes. Next time Congress takes up LIHDWWEAP, they'll probably have more than 300 words to say about how to carry it out.
*Y’all Capitol Hill people really need to think through the acronymic implications of the names you stick on programs.
**They’re not, really.
†We badly need such a study, but serious evaluation (i.e., rigorous analysis, not cherry-picked case studies) won’t be easy or cheap. Got a couple hundred grand to sponsor such a study? HMU!
Confluence. [kän-flü-ən(t)s]. n. A coming or flowing together, meeting, or gathering at one point.
More evidence that, in a politically divided nation, water unites
Last month I argued that water ought to be the centerpiece of the Biden Administration’s environmental policy. President-elect Biden has announced climate change as the main pillar of its policy agenda, but the nation is deeply divided on climate, and so lasting progress will be difficult or impossible on greenhouse gasses. Meanwhile, protecting water is one of very few significant areas of public policy where the country is united, not polarized. That gives the president-elect and congressional leaders from both parties an opportunity to build a coalition for significant legislation on water. The idea seems to have struck a chord with many folks*, and it's picked up some momentum. More and more voices joining the call to rally to water policy when the new Administration and 117th Congress take office.
Encouraged by the response to my last post, I went casting about for more recent data on broad public support for water policy (my Texas A&M data were gathered in 2015). Happily, the 2020 Value of Water survey (VOW) by the U.S. Water Alliance asked about both climate and water. The national poll let respondents express their attitudes on a four point scale from “extremely important/concerned” to “not too important/concerned.”
The results are remarkably consistent with my earlier findings:
N=454. Thin bars represent 95% confidence intervals.
Once again, there’s a familiar stark gap between Democrats and Republicans on climate, but virtually no difference on questions about drinking water and water pollution.** And again, respondents who identify as strong Republicans express very little concern for climate change, but very strong concern for both drinking water and water pollution.
City water, country water
More than twenty years of experience and gigabytes of data have also convinced me that water also can unite urban and rural interests for leaders who want to build political bridges. And what do you know? The VOW survey also gathered data on where respondents live:
N=499. Thin bars represent 95% confidence intervals.
Once again, we see a significant divide between urban and rural folks on climate, but virtual unanimity on water.*** Strident (and likely futile) efforts by the Biden Administration to push climate initiatives in Congress would only deepen the divide between rural and urban America. But initiatives to deliver safer drinking water and fight water pollution could bring together urban and rural interests.
Art of the possible
Meaningful, enduring public policies require building coalitions across diverse segments of the American public. If the incoming White House and congressional leaders are serious about solving problems, they’ll do well to work on water.† People across the political spectrum want safe, great-tasting tap water, and fishable/swimmable rivers, lakes, and oceans. The impact of good water policy is immediate and tangible. Landmark legislative wins are on the table for politicians with the vision and courage to pursue them.
But more than that, progress on water would help heal the nation’s political wounds, and demonstrate to a wary public that the institutions of the Republic can still fulfill the promise of a better life.
*I had a nice conversation on KJZZ in Phoenix on this topic.
**These relative partisan gaps remain in regression models that control for age, gender, race, and ethnicity.
***These relative urban/rural differences remain after controlling for party identification age, gender, race, and ethnicity.
†And remember: an awful lot of good water policy is also good climate policy. If you care about the planet more than you care about branding, talk less about CO2 and more about H2O.
Why water should be the Biden Administration’s top environmental priority
The Biden administration’s environmental policy priorities are likely to be quite different from the Trump administration’s, and the impending change at the White House has visions of sweeping new federal greenhouse gas policies dancing in environmentalists’ heads. But sober political observers know that the prospects of significant climate policy—let alone a Green New Deal—are virtually zero so long as Republicans maintain a majority in the Senate.* A trillion-dollar infrastructure and/or bailout package for local water infrastructure are also probably non-starters. Those are going to be bitter pills for many of the President-Elect’s supporters to swallow. It’s also why the Biden administration should make water, not climate, the centerpiece of its environmental agenda when it takes office in January.
Everybody cares about water
Once upon a time, environmental protection wasn’t an especially partisan issue. Indeed, most major milestones in U.S. environmental policy were signed into law by Republican Presidents.** But over the past 40 years environmental policy has become increasingly partisan at the national level, with Democrats widely perceived as more protective and Republicans less protective of environmental quality. Perhaps the most divisive environmental issue of all is climate change. When global warming entered the national political consciousness in the early 1990s there wasn’t much difference between partisans on the issue. A generation’s worth of general party polarization has changed all that, however, and today Democrats and Republicans are deeply divided even over the basic facts about climate policy. Today climate policy is nearly as divisive as abortion or guns in our national politics. Environmental activists clammor loudest for a big federal greenhouse gas program, but it is difficult to imagine any major legislation branded as a “climate” bill clearing the Senate’s 60 vote hurdle with so many red states lined up against it.
Water is different. It seems that radical polarization hasn’t yet contaminated our most essential resource. Unlike climate threats, where risks seem distant and causal linkages uncertain, risks to water quality are immediate, the causes known, and the effects tangible. It’s no coincidence that the partisan divide on water is much narrower than it is on climate. A few years ago, I helped the Texas A&M Institute for Science, Technology, and Public Policy run a national public opinion survey on environmental issues. We asked respondents to rate their level of concern about issues on a 0-10 point scale, with 10 meaning “extremely concerned” and zero meaning “not at all concerned.” As you’d expect, we found consistent partisan gaps across issues. But one really striking finding stood out to me and has stuck with me ever since. Check this out:
The public opinion gap between Democratic and Republican concern is greatest for climate change and smallest for water quality.† What’s more, the average Republican falls on the “not concerned” end of the spectrum on climate change (4.3), but well into the “concerned” range on water (6.4). On reflection, that result shouldn’t be surprising: Republicans like to drink water and flush their toilets just as much as Democrats do, and I’d guess that a good number of America’s hunters and sportfishermen tend to vote with the GOP.What’s more, the nation’s most severe drinking water, water pollution, and infrastructure affordability problems are in rural America. Big cities like Flint, Detroit and Newark tend to get the most attention from reporters and politicians, but the water challenges of rural communities are in many cases much more daunting.
Joe, Kamala, and the 117th
These political conditions are ripe for a bipartisan, urban-rural coalition to improve the nation’s drinking water and water quality. Rather than beating their heads against the stone wall of a GOP Senate in vain pursuit of climate policy, the Biden Administration ought to focus its legislative efforts on systemic reforms to improve the water sector. Vice President-elect Harris has been working on water issues actively since joining the Senate, so she’ll come into office with some expertise on the issue and is poised to be an effective champion. Major legislative victories in the 117th Congress won’t come easy for anyone, but water policy offers perhaps the best chance to get something big done on the environment.
And guess what? It turns out that lots of the things we do to protect water quality (e.g., aquifer protection, watershed management, wetland restoration, sustainable agriculture, etc.) also reduce greenhouse gas emissions and mitigate climate change impacts. So a big victory on water policy would be a big victory for climate policy, too.***
*It’s technically possible for Democrats to pull even in the Senate with a sweep of Georgia’s special Senate elections. New Vice President Harris would then break the leadership tie and give Democrats control of the 117th Senate. My political science spidey sense tells me this is an unlikely scenario.
**Lincoln created the first national park when he signed the Yosemite Grant Act in 1864. Theodore Roosevelt established the U.S. Forest Service, signed five more national parks into law and established 19 national monuments. Nixon established the Environmental Protection Agency and signed the Clean Air Act. Ford signed the Safe Drinking Water Act and RCRA, and Bush41 championed the 1990 Clean Air Act Amendments that created the first cap-and-trade system for managing air pollution.
† These partisan gaps remain in regression models that control for age, gender, race, ethnicity, and income.
***Just don’t say that part out loud in red states.