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.
What and who do the federal coronavirus relief programs fund?
Most – all but one – of the programs described here do not provide specific financial relief to explicitly cover water/wastewater utilities (“water utilities”). In fact, the programs generally are funded to provide relief for multiple needs, of which payment to water utilities are included. Relief is usually tied to housing (mortgage or rent) and various other utilities (including electric, natural gas, etc.). This means that the funds available for water are shared with other basic needs and services, many of which impose a far greater financial burden on households than water and are expected to receive a much larger share of the relief funds.
There are also different eligibility criteria for the different programs. Whether a customer is residential or commercial, a homeowner or renter, low income or moderate income, and/or is or is not affected directly by the pandemic affects their eligibility for different programs. This complexity is only a consequence of funding multiple existing programs that have different purposes and priorities, but the distribution of funds across multiple programs in fact increases the chances that customers of various characteristics might be eligible for at least one source of financial relief to help pay for water bills.
Which programs received federal coronavirus relief funds that may be used to help pay for water bills?
As of February 2021, two economic stimulus bills have been passed while a third is being debated. This post summarizes the coronavirus relief funds in the two bills that were passed.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, signed in March 2020, provided funds for the following that may be partially used to assist customers with water bills:
- The Coronavirus Relief Fund (CARES Act assistance for State, Local, and Tribal Governments)
- Community Development Block Grant CARES Act (CDBG-CV)
- Emergency Solutions Grant CARES Act (ESG-CV)
- Small Business Paycheck Protection Program
In December 2020, the Consolidated Appropriations Act, 2021 extended those programs, and additionally funded:
- Low-Income Household Drinking Water and Wastewater Emergency Assistance Program (read more below)
- Emergency Rental Assistance Program
Both of which provide significantly more funds that can be used for utility payments.
Download one-page factsheets about each of these funds and how they relate to assistance for water bills.
The first-ever federal program providing financial relief to low-income households exclusively to pay for water and wastewater bills
Among the myriad of existing funding programs that the federal government infused with relief funds during the pandemic, a brand new program was created that – for the first time – provides financial relief exclusively for water and wastewater bills. In December 2020, $638 million was designated in the Consolidated Appropriations Act, 2021 to a new nationwide Low-Income Household Drinking Water and Wastewater Emergency Assistance Program. The program will assist low-income households that pay a high proportion of their income for drinking water and wastewater services by paying the utilities to reduce the households’ arrearages and bills. Details about this program are not yet announced. The U.S. Department of Health & Human Services (HHS) will administer the program at the federal level, and distribute the $638 million to states and tribal governments based on the proportion of households in their jurisdictions that have income at or below 150% of the Federal poverty line, and the percentage of households that spend more than 30% of their monthly income on housing.
Household eligibility criteria, the application process, and even which state agencies or partnering organizations will be involved in this program to provide assistance to households are all yet to be determined. The Act encourages the use of existing programs to provide assistance to low-income households, but does not require those existing programs to be focused on water bill payment assistance programs. The Act requires that payments be made to the water and wastewater utilities directly on behalf of the eligible households to reduce their arrears and/or bills.
The creation of a national low-income household assistance program to help with water bills is welcome news since water rates have been rising faster than inflation and faster than household income in recent years. More and more households need assistance to afford their bills, and the COVID-19 economic conditions have compounded the need.
Duplication and coordination
With multiple programs potentially available to assist customers pay for water bills, the program administrators are required to document the eligibility of the covered costs and to ensure there is no duplication of assistance. In other words, that customers are not “double dipping” to receive assistance for the same water bills across different programs. In addition, the relief programs will send payments directly to the water utilities on behalf of the people they are helping. For both reasons, there will likely be coordination and communication between the organizations assisting households and their water utilities.
Where should customers go for help?
Although the coronavirus relief programs are administered by federal agencies, the funds are distributed to states and territories, a few large local governments, and tribal governments (see the factsheets from more info and for links to see the allocations). Some of those grantees are administering the funds themselves, or partnering with local governments and/or other organizations to provide the assistance to people directly.
In addition to these coronavirus relief funded-programs, many water/wastewater utilities, municipal and County departments, charities, Community Action Agencies, and other non-profit organizations had long before set up bill payment assistance programs that help low-income households locally. We have blogged about local customer assistance programs before, and whether water utilities are able to use their own revenues to fund a bill payment assistance program. (If your utility is considering starting a bill payment assistance program using funds from any source, you can use this calculator to estimate how much funding will be needed to meet the projected demand based on your program design). These local programs already have the processes in place to validate the need of households and assist them in paying their bills. Some may also be partnering with the government programs administering the federal coronavirus relief funds.
The multiplicity of assistance programs can lead to confusion among people and utilities, but also can enhance outreach and support. There are several websites that attempt to list the programs that people can go to for assistance with water bills; too many to list here. Please feel free to suggest useful links that list multiple bill payment assistance programs in the comments below.
In most cases, people should first check to see if their water utility partners with a bill payment assistance program or has other ways to assist its customers. Next, they should contact local charities and the County’s human services or social services department to find information about organizations that might be providing bill payment assistance for those in need. Another avenue is to check 211 to see if the state, territory or tribal government has a regional program. For instance, United Way and 211 in North Carolina are hosting the applications for the State of North Carolina’s NC HOPE program that is set up to administer the federal coronavirus relief funds for utility assistance.
Updates, and more coronavirus relief funds on the way?
Water bill payment assistance programs will very likely continue to evolve and may receive additional funds in the future. As of now, Congress is debating a third relief bill which would include more financial assistance that can be used for water bills. While the details may change, additional funds are currently proposed to supplement some of the programs listed above (including the Low-Income Household Drinking Water and Wastewater Emergency Assistance Program) as well as to establish a Homeowner Assistance Fund that might provide assistance on utility bills. As more is determined on the existing or possibly new programs, particularly about the Low-Income Household Drinking Water and Wastewater Emergency Assistance Program, we will update the resources and blog.