oEPA

Water Affordability Needs Assessment

Water Associations & Utilities

Session 1 - Capturing the Extent and Impact of Water Affordability to Households and
Utilities I March 27,2024

Background and Introduction

In the Infrastructure Investment and Jobs Act of 2021 (IIJA), Section 50108, [42 U.S.C. 300j-19a],
Congress directed the U.S. EPA to produce a Water Affordability Needs Assessment Report to
Congress. In producing the report and as directed in Section 50108 of the IIJA, EPA gathered
stakeholder input from a diverse group of experts in the water affordability field, including utilities,
associations, academia, nonprofits, community-based organizations (CBOs), advocacy groups,
and the public. These stakeholders included experts who have spent decades working to address
water affordability challenges across the U.S.

In March and April 2024, EPA hosted two series of targeted Stakeholder Listening Sessions, each
series consisting of three sessions. One series focused on gaining perspectives from water
associations and utilities, while the other focused on feedbackfrom nonprofit and advocacy
communities. EPA invited participants from water utilities and associations, including rural
advocacy associations, as well as select nonprofits, non-governmental organizations (NGOs), and
CBOs, to participate in these sessions. EPA provided the stakeholders with background on this
report, solicited feedbackfrom stakeholders on proposed data sources and EPA's data analysis
approach, enlisted stakeholder assistance in case study development and review, and discussed
recommendations for addressing affordability challenges nationwide.

This document summarizes the first listening session for invited participants from select water
associations and utilities, which was held on March 27,2024.

The purpose of this first listening session was to provide an opportunity for water associations and
utility stakeholders to hear an overview of the Needs Assessment Report and share their feedback.
Specific session objectives included:

•	Review the background on the Water Affordability Needs Assessment Report.

•	Highlight resources and tools to be included in the report.

•	Request case studies from participants that highlight water affordability in their
communities.

•	Preview the Session 2 topics of affordability definitions, benchmarking, and data.

Listening Session Summary

Publication Number: EPA-830-S-24-002	Water Affordability Listening Session


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Important Aspects of Water Affordability

Ellen Tarquinio (U.S. EPA) opened the session by welcoming participants and invitingthem to use
the meeting chat to share their responses to the question, "What is the most important aspect of
water affordability that you want to see captured?" Attendees noted the following concepts as the
most important aspects of affordability to them:

•	Meetingthe total need for low-income assistance and identifyingthat need on the local to
national level.

•	Renewing infrastructure while maintaining affordability for low-income customers.

•	Sustainability of a long-term customer assistance program.

•	Calculating affordability at the individual household level as opposed to the community
level.

•	Bringing in water conservation, efficiency, plumbing repair, education, etc. as key
complementary strategies to address water affordability challenges.

•	Acknowledging challenges for utilities in developing their own customer assistance
programs, including restrictions in state laws and capacity issues in staffing.

•	Recognizing that water affordability intersects with many other issues. For example,
affordable rates should be examined in the context of how they impact a utility's ability to
provide safe and reliable water service.

•	Ensuring data gathered and used in the report is of quality and representative of all sizes of
utilities across the U.S.

Water Aff orda bility N eeds Assessment

Ellen Tarquinio then provided an overview of the scope of the Water Affordability Needs
Assessment report. Key highlights from her presentation are below.

•	The EPA was directed by Congress to conduct this Needs Assessment and provide an
understanding of the impact of the water affordability burden felt across the U.S. among
households and utilities, as directed in the IIJA, Section 50108. IIJA also requires EPA to
recommend methods for increasing affordable access to water services.

•	The Water Affordability Needs Assessment is focused on providing a national picture of the
impact of water burden on households and utilities.

•	The direction for the Needs Assessment can be viewed in three components:

o The first component of the report examines the percentage of utilities that serve a
disproportionate percentage of households that qualify as high water burden or the
percent of utilities that have taken on an unsustainable level of debt due to large
customer arrearages.

o The second component focuses on examining the definitions of'affordability', 'lack
of access to affordable water,'and number of households impacted by high water
rates. Further direction recommended an analysis of the size of arrearages,
disconnection rates and fees, and tax lien data.

Publication Number: EPA-830-S-24-002

Water Affordability ListeningSession • 2


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o The thirdcomponentexploresthe scopeand extent of wateraffordabilitychallenges
in the U.S. and requires EPA to provide recommendations, including program costs,
associated with addressing this challenge.

Facilitators then invited participants to ask questions about the scope of the Needs Assessment.

Highlights of the participant discussion and EPA responses are as follows.

•	Cost of Business. EPA requested suggestions for how to include cost of business in the
report.

•	Impact of State and Local Laws. The Environmental Finance Advisory Board (EFAB) is
looking into rate setting laws that will impact affordability for utilities and different
approachesfor capitalfinance.Their findings and recommendations will be included in the
EFAB water affordability deliverable.

•	Bundled Water and Trash Bills. Many utilities were unable to participate in the Low-Income
Household Water Assistance Program (LIHWAP) because billing systems could not
separate out the trash portion of bills from water. EPA should include recommendations
that address this challenge in the report, and EPA welcomed any suggestions on how to
best address this.

•	Proposed Regulations. The affordability assessment will not incorporate future forecasting
for potential rates impacts that may result from future regulations (e.g. on emerging
contaminants).

Engagement Approach

Ellen Tarquinio provided an overview of EPA's approach to engaging with key stakeholders. Key

highlights from her presentation are as follows.

•	EPA plans to rely on existing data sources to develop this study, such as the LIHWAP
assessment, EPA's other needs assessments/surveys, several state surveys and rates
dashboards, Census household datasets such as the American Community Survey, utility-
specific water rate data, financial reviews, and input from stakeholder partners.

•	The report will also mention affordability definitions and criteria used by states in the Clean
Waterand DrinkingWaterState RevolvingFund programs, Financial Capability Assessment
Guidance, commonly used definitions by industry groups, as well as stakeholder input.

Existing Resources/References/Case Studies

Jean Ray (U.S. EPA) provided an overview of the resources and references that will be included in

the report. Key highlights from her presentation are as follows.

•	The report will build on the vast amount of research and resources that have focused on
addressing water affordability. The intent is to leverage existing datasets, while filling gaps in
particular areas such as disconnection fees and rates, rural areas, and small systems.
There are limitations to utilizing this approach rather than conducting a full survey. The
identification of these gaps will set the stage for future research.

Publication Number: EPA-830-S-24-002

Water Affordability ListeningSession • 3


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•	By engaging with stakeholders early and throughout the report and assessment, EPA
intends to incorporate expert advice to provide informed recommendations and an
informed analysis approach.

•	An important part of this workis ensuring thatthis report and all the work EPA is conducting
on water affordability shows the impact of water burden to households, communities, and
utilities through case studies. These viewpoints will be a critical piece of the report. The
process for case study engagement includes initial conversations with EPA on specific
affordability concerns or highlights. EPA will then write up a draft case study with the
community providing input and clarifications before reviewingthe final case study. EPA
presenters invited participants who want to know more about the case study process to
contact Melinda Luetke (Luetke.Melinda@epa.gov).

Suggested References

EPA invited participantstosharetheirsuggestionsfor resourcesthatthe Needs Assessment should
draw on. Resources that participants shared in the meeting chat are listed below.

•	A Promising Water Pricing Model for Equity and Financial Resilience (US Water Alliance)

•	Small and Disadvantaged Community Water Funding Roadmap (U.S. Chamber of
Commerce)

•	The Growing U.S. Water Affordability Challenge and the Need for Federal Low-Income Water
Customer Assistance Funding (NACWA)

•	Water Affordability Dash board (Nicholas Institute for Energy, Environment, & Sustainability)

Ellen Tarquinio ended the session by thanking participants for attending and inviting them to return
for the second listening session.

United States Environmental Protection Agency
March 2024
EPA-830-S-24-002

Publication Number: EPA-830-S-24-002

Water Affordability ListeningSession • 4


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