Chicago takes action on providing equitable relief for water service - Metropolitan Planning Council

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Chicago takes action on providing equitable relief for water service

Announced yesterday, Chicago’s new equity-focused water bill relief program promises to bolster city coffers while offering families relief

Water rates vary widely across our area. Towns with median household incomes in the bottom 10 percent of the Chicago region pay 31 percent more a month for water than towns with a median household income in the top 10 percent, the Chicago Tribune reported in its “Water Drain” series.

Twice-yearly water bills pile up, becoming insurmountable, and forcing families to make difficult choices between basic services to which every human deserves access: water vs. medical care, groceries, or electricity.

That’s how it’s long been in Chicago.

But today the City of Chicago announced the creation of a new Utility Billing Relief program, which will provide low-income residents with a reduced rate (50%) on their total water bill. This program will also halt late-payment penalties and debt-collection actions, as well as provide debt forgiveness for those who demonstrate they can manage the reduced rate bills for one year. MPC applauds Mayor Lightfoot’s Administration in rolling out this much-needed program as an important first step in addressing significant equity issues related to water service. Generally, Mayor Lightfoot and City Clerk Valencia have been working to together to reduce a number of punitive fines and fees. 

MPC released a set of recommendations for the city’s incoming mayor this spring, including:

Rework the city’s current water shut-off policies and available affordability programs

According to a recent American Public Media story, the cost of water for an average family of four in Chicago nearly tripled between 2007 and 2018—from $178 per year to $576. While water rates in Chicago have gone up for often justified reasons—such as replacing century old pipes and water service infrastructure—our existing water rates are regressive in nature, and have impacted lower-income residents the most.

Based-off the Federal/State Low-Income Home Energy Assistance Program (LIHEAP), the City of Chicago will be partnering with the Community and Economic Development Association of Cook County (CEDA) to help rollout and provide outreach on the program. It is also worth noting that the startup costs of this program will be funded by the Water and Sewer enterprise funds, and not from the 2020 Corporate Fund budget.

“This will not only offer relief to families struggling to choose between paying their water bill or other services, it will bring in revenue the City currently isn’t getting because those residents simply can’t afford to pay,” said Mayor Lori Lightfoot in yesterday’s budget address. “We’re doing this because it’s good policy, but we’re also doing this because it’s the right thing to do.”

In addition to this new low-income assistance program, predicted to assist about 20,000 households, the City is also undertaking a number of much-needed billing reforms:

  • Moving all nonmetered and metered residences to a monthly billing cycle – a key component for transparency and improved budgeting for customers;
  • Eliminating continued billing after a documented water shut off has been completed; and
  • Improving water bills in order to provide more clarity around line item charges that are included.

MPC is supportive of Chicago in creating and implementing this new, critical program for residents. This first step on the path to equitable water service is important. Next up: improved customer education and designing rate structures that incorporate best practices in equity. Congrats, Chicago, let’s keep the momentum going!

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  1. Sincerest Thanks and Best of Luck, Sarah!

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