Baltimore is launching a long-awaited water discount program that will give city residents income-based financial assistance with their bills.
The program, known as Water4All, provides a monthly discount for water and sewer costs for some residents based on their income. Tenants who do not pay their water bills directly also will be eligible for water payment assistance.
Democratic Mayor Brandon Scott announced the start of the program at a news conference Tuesday, calling it an important step in creating a more equitable Baltimore. Access to clean, affordable water should be considered a fundamental right, he said.
“Water4All will be a game changer for our residents,” Scott said.
Water4All will use a rate schedule that caps bills at 1%, 2% or 3% of a customer’s income, depending on household size. The program, which takes effect immediately, is available to residents with incomes less than 200% of federal poverty level — a threshold of about $53,000 per year for a family of four.
Tenants whose names are not on the water bills for the properties where they live must provide copies of their leases, stating they are responsible for water and sewer service fees, along with documentation of the amount they pay.
Water4All has been many years in the making. The program was mandated by the city’s broader Water Affordability and Accountability Act, a sweeping piece of legislation designed to make changes to Baltimore’s long-dysfunctional water billing system. The Baltimore City Council passed the act in 2019 and it was due to take effect in July 2020. However, then-Mayor Bernard C. “Jack” Young, a Democrat, said the coronavirus pandemic complicated the process and delayed its implementation by a year.
In 2020, the City Council, then headed by Scott as council president, passed legislation calling for the implementation of the act to be accelerated. Under that legislation, new interim effective dates were created, including an April 1, 2021, deadline to publish proposed rules and regulations for Water4All. The entire act was due to be implemented by July 2021.
That July deadline was not met, and even with the implementation of Water4All now, pieces of the law remain unfinished. Most significantly, the city has yet to hire a customer advocate who is meant to head an independent dispute resolution process for water bills.
Complaints of overbilling from customers of Baltimore’s water system have abounded for years, and the city has lagged in addressing requests for repairs. A December 2020 joint report from the Baltimore City and Baltimore County inspectors general found more than 8,000 open “tickets” for problem water accounts that had been unresolved, many of them for years at a time. The city-operated system serves both the city and Baltimore County.
James Bentley, a spokesman for Scott, said the city prioritized Water4All because it will assist residents in the greatest need.
“This piece has the largest impact for residents who are struggling paying water bills, who are seeing rising costs,” he said. “That was the focus.”
Rianna Eckel, senior Maryland organizer of the group Food and Water Watch, praised Baltimore for establishing the program, one of only two in the country to provide income-based water affordability services. The other is in Philadelphia.
After years of steady rate increases, more than half of Baltimore City residents pay more than 3% of their household income for water — the international standard for affordable water service, Eckel said. Water rates for Baltimore customers have increased by 10% annually for the last three years, based on a schedule approved by the city Board of Estimates in 2019.
Eckel said Food and Water Watch expects Water4All to increase revenue to the city as residents receive more affordable bills. Currently, most customers who receive bills they cannot afford don’t pay at all, Eckel said.
“When water bills are affordable,” she said, “people pay them.”
Still, affordable water advocates have concerns about the Water4All program as it is being implemented.
For instance, eligible tenants who are not named on their water bills but instead pay their landlords for water service will receive preloaded debit cards with the amount of their savings. The federal government considers that taxable income, and recipients of the program will receive 1099 forms from the government at the year, Eckel said.
Eckel said the small infusion of income could be enough to make some recipients ineligible for other income-based benefits they receive from the government.
“This goes against the premise of the program,” Eckel said. “It’s not affordable if we’re taxing that.”
Scott said during the news conference Tuesday that the tax issue remains a concern.
“We don’t want to hurt our residents while trying to help them,” he said.
Faith Leach, deputy mayor of equity, health and human services, said the tax issue will be disclosed to recipients of the funds, and city staff will receive training in benefits counseling to provide assistance to applicants who are at risk of losing benefits if they apply.
Long term, city officials plan to work on the issue with state and federal legislators, Leach said.
“When you’re talking about a necessity — that’s what water is — for residents in one of the wealthiest states in the wealthiest countries in the history of the world, this should not take away from any other benefits,” Scott added. “That’s why we have to push our other partners to understand that.”
Water4All replaces Baltimore’s existing BH20 Assists and BH20 Plus assistance programs, which were closed to applicants in July. Applicants to Water4All can apply for assistance retroactively dating back to that month, Bentley said.
Tuesday’s announcement came just ahead of the release of an audit report on the city’s water billing operation. Due to be presented Wednesday to the Board of Estimates, the report shows the city has no process to collect delinquent funds owed by its customers. The system has about 400,000 water meters in the city and the county.
According to a draft copy of the audit, city officials have not been monitoring all billing complaints to make sure they are acknowledged within 48 hours and resolved within five business days — benchmarks in place during the audit of fiscal years 2019 and 2020. Officials with the Department of Public Works told auditors that they monitored the complaints of city customers, but not those in the county, to track how quickly they were handled.
“Without monitoring the timeliness of resolving customer billing complaints, DPW cannot manage the operating effectiveness and adequacy of the workforce,” city auditor Josh Pasch wrote.
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Additionally, officials did not monitor a report generated monthly that shows accounts that are overdue by 30 days, 60 days, 90 days or longer. Late notices are not sent to customers with overdue bills and accounts are not referred to the city’s Law Department or collections agencies if overdue, according to the draft report.
Pasch recommended city officials quantify the amounts, customers and months when water bills have not been paid and provide the information to city leaders.
DPW managers agreed with the recommendation, but said “passive tools,” such as delinquency charges, liens and termination of service, have been used before to collect on overdue accounts.
Some collection tools have been hampered by the coronavirus pandemic, DPW leaders wrote.
Scott and Baltimore County Executive Johnny Olszewski Jr. issued executive orders in March 2020 saying neither jurisdiction would turn off water service for failure to pay during a state of emergency such as the pandemic.
“Agency leadership continually monitors revenue and holds discussions internally about revenue collection practices,” department managers wrote. “Current collection practices have not had a material impact on the financial condition of any of the utility funds.”
DPW collected $177 million in fiscal year 2019 in water payments. In fiscal year 2020, the total was $212 million.