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Water Affordability Needs Assessment Public Listening Session

Listen Session Summary I June 3,2024

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, advocacy groups, and the
public. 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, and
community-based organizations, to participate in these sessions.

In June 2024, EPA hosted a broader-scale public listening session to hear from communities,
utilities, and advocacy groups who were not previously involved in the report's development to
share their experiences, perspectives, and ideas regarding water affordability challenges and
recommendations. Specific session objectives included:

•	Discuss the importance of access to affordable water and impact of affordability
challenges.

•	Provide an overview of EPA's upcoming Water Affordability Needs Assessment and Report.

•	Share experiences, perspectives, and ideas regarding water affordability challenges and
recommendations.

Public Listening Session Welcome and Introduction

Andrew D. Sawyers, Ph.D. (Director, Office of Wastewater Management, U.S. EPA) welcomed
participants to the session and provided opening remarks. He emphasized EPA's commitment to
addressing affordability challenges across the U.S. and recognized that many utilities are struggling
to meet capital costs, and many customers are strugglingto pay their water bills.

Jean Ray (U.S. EPA) and Melinda Luetke (U.S. EPA) provided an overview of the upcoming Water
Affordability Needs Assessment and Report to Congress. Key highlights from their presentation
are below.

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•	The goal of the report is to 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.

•	The objectives of the Water Affordability Needs Assessment Report are to summarize the
decades of workthat has been done in this space; highlight utilities, academics, and
associations that have been at the forefront of this research; and develop approaches to
address water affordability concerns.

•	The report will examine the percentage of utilities that serve a majority of households that
qualify as high-water burden, and the extent of debt held by utilities due to large customer
arrears.

•	The report will review 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, number of households impacted by unaffordable
rates, disconnect rates and fees, and tax lien data.

•	The report will also outline the scope and extent of the water affordability crisis in the U.S.
and provide recommendations on how to address this challenge.

Public Comments

Rob Willis (Ross Strategic) opened a discussion session for attendees to share comments. Priority
was given to those that expressed interest in commenting when they registered, and all attendees
were able to submit questions during the session. Key highlights from the public comment period
are as follows.

Challenges for Utilities

•	Affordable Rate Setting. Several participants shared that utilities have a difficult time setting
affordable rates while keeping up with costs of maintaining systems. Two representatives
from public utilities stressed that setting rates that are affordable for ratepayers has
become more difficult for utilities. The challenge is that setting affordable rates for
communities is often outpaced by other rising costs. Additionally, unprecedented rate
increases are challenging for cities to plan for and ultimately places the burden on
taxpayers.

•	Infrastructure Updates. An attendee expressed the desire to upgrade aging infrastructure
without needingto increase rates for customers. Infrastructure loans are inaccessible
without the ability to increase water rates to make up for the costs of the upgrades.

•	Costs Associated with Regulatory Requirements. Participants stressed that compliance
costs associated with current and future regulatory requirements (both federal and state)
will result in utilities needingto raise rates, in some cases. Very small water systems, such
as mobile home parks, some condos, and those not affiliated with the local municipality,
are sometimes unable to access funding programs to come into compliance with
regulations. Compliance can be extremely expensive, yet regulations are issued without the
funding needed to completely build and help operate new systems. Utilities lackthe
freedom to prioritize addressing local concerns.

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•	Rates and Customer Affordability. Utilities have difficulties setting affordable rates while
keeping up with the costs of system maintenance and compliance with new regulations. An
attendee sharedthattheirstate recommends they raise the rates to compensate for newer
regulations.The example shared was the requirement to treat for PFAS, for which the costs
often outweigh the funding received.

•	Consolidation Challenges. The push toward consolidation is a challenge, as small
communities lacka clear entity to consolidate into, and intent to consolidate can be an
obstacle to accessing financing.

Challenges with Funding and Financing

•	Competition for Limited Grant Funds. An attendee shared that, as a small system, they
often struggle obtaining grants when compared to larger systems.

•	Loans Repayment. Much of the assistance available from the federal government is in the
form of loans, not grants, which must be repaid. Some participants felt that these loans do
not do enough to help utilities replace aging infrastructure without raising rates.

•	Loans for Small Systems. An attendee noted that very small water systems, such as mobile
home parks, some condos, and those not affiliated with the local municipality, are
sometimes unable to access loans to get into compliance with regulations.

Challenges for Communities

•	Alleviating Burden for Disproportionately Impacted Households. Several attendees
expressedthatany new government program must be designed to address consumers that
have been disproportionately impacted. For example, low-income communities and
minority populations live disproportionately near contaminated water resources and are
more impacted by high water and wastewater service rates.

•	Local Hiring. Small utilities struggle with a lack sufficient staff capacity. An attendee
recommended using Justice40 funding for local hiring and contracting to close the
perpetual loop of households needing assistance to afford theirwater bills.

•	Impacts of Irrigation. Several stakeholders shared that there are some cities with reduced
access to water due to large scale irrigation and other competing water use demands.

•	Technical Assistance (TA). An attendee suggestedthat otherlisteningsession attendees can
help TA providers understand better ways they can connect with smaller systems and
provide help.

•	Public Trust. Stakeholders recommended that EPA support additional community
engagement to help build trust. Challenges with building public trust in water utilities was
cited as a reason some households were purchasing bottled water and could lead to non-
bill payment.

Customer Assistance Programs (CAPs)

•	Support for Permanent LIWHAP Recommendation. Attendees expressed support for a
permanent LIHWAP program to provide reliable relief for ratepayers.

•	Importance of Marketing and Communication. Particularly in rural areas and small
communities, households can face significant obstacles in accessing and navigating

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assistance programs. It is important that future federal assistance programs include
funding for communications and marketingto promote enrollment. For example, in New
York officials promoted LIHWAP with informationalflyers, a designated LIHWAP awareness
day, a press conference featuringtestimonials, and even lit up a bridge in the
appropriate colors.

• Rate Studies. An attendee noted that they would like to see EPA support utilities that
conduct rate studies, which can help with the implementation of assistance programs.
These studies are important because utilities need to understand their customer base to
effectively implement a new program supporting affordability.

Closing

Ellen Tarquinio (U.S. EPA) ended the session by thanking participants for attending. EPA presenters
invited participants with follow-up questions and comments to contact Jean Ray
Rav.Jean@epa.gov).

United States Environmental Protection Agency
June 2024
EPA-830-S-24-008

Publication Number: EPA-830-S-24-008

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