Kinks slow Detroit area water bill aid effort

Christine Ferretti
The Detroit News

Detroit — Confusion, forgetfulness and financial strain have limited a new regional assistance program in helping out low-income water customers with their bills.

While the Water Residential Assistance Program, or WRAP, has signed up about 1,270 Metro Detroit households since it launched in March, there’s a backlog of 2,500 to 3,000 customers waiting to enroll.

And dozens of those in the program already have failed to make their required payments.

Detroiters represent about 90 percent of customers enrolled in the regional program, which is being administered by the Wayne Metropolitan Community Action Agency in Detroit in conjunction with the Detroit Water and Sewerage Department (DWSD).

“A lot of them are having issues with just understanding the process,” said Gary Brown, DWSD’s director. “It’s new for customers, it’s new for staff and we’re working out the kinks.”

A $4.5 million fund was created for the program as a component of the Great Lakes Water Authority forged through Detroit’s historic bankruptcy.

Its assistance comes nearly two years after the city’s water department initiated a controversial water shutoff campaign for unpaid commercial and residential water accounts to crack down on widespread delinquencies amid the city’s financial crisis.

The program is designed to help qualifying customers in Wayne, Oakland and Macomb counties who are at or below 150 percent of the federal poverty level — which equates to $36,450 for a family of four — by covering one-third of the cost of their average monthly bill and freezing overdue amounts.

In its first two months, the program enrolled 389 Detroit households, but only 28 percent made all payments. But 46 percent missed one payment and 12 percent missed two, Brown said.

Customers, he said, can be taken out of the program if they fail to make two payments.

But DWSD hasn’t kicked anyone out of the program — yet. Wayne Metro, Brown said, is first reaching out to those who have fallen off.

“We want to give people an opportunity to be successful, but as soon as we go back and make sure they are aware of the requirements that will happen because other people are waiting in line to get into the program,” he said. “That’s my objective ... to get the money out the door to the people that need it.”

And individuals in the backlog, Brown stressed, have had arrearages frozen and aren’t in danger of having water service cutoff. The people in that queue represent about $5.4 million in payments past due.

Brown added the figures for customers who signed up for WRAP in March and April represent a snapshot but don’t account for all of the city customers in the program since billing cycles vary.

Detroit residents kicked out of the program can pursue help through a separate program — the 10/30/50 plan — which isn’t income based.

In DWSD’s 10/30/50 plan, customers pay a minimum of 10 percent of their past due amounts, with the remaining amount to be paid over 12-24 months.

As of Friday, Detroit customers are seeing a 3.25 percent increase in water and 3.6 percent increase in sewer rates. Officials have called the increase “modest,” saying it’s the lowest in several years.

The average usage for a Detroit family of three was $66.41 for water and sewer in June. The cost for a family of three with the same level of usage will now rise to $68.19, water officials said.

Enrollment weeks behind

Wayne Metro was initially hit with an influx of applicants, but that’s since leveled off. Brown has now directed the organization to bump up enrollment to 500 clients each week.

“Right now, they are more than 30 days behind. We want those people processed in a lot quicker time,” Brown said. “We want to get the money out the door to the people that need it. I’m confident that Wayne Metro will be able to live up to that obligation.”

Mia Cupp, communications manager for Wayne Metro, said the aid agency has 50 staffers daily who are taking calls and meeting with individuals about the program. Cupp said the agency is prepared for the ramp up, noting they met with 480 households in the third week of June. Not all applicants turn up for appointments, qualify or have proper paperwork during their visits, she said.

Overall, 94 percent of the households in the program have arrearages. The average overdue amount is $845, Cupp said.

For Detroit, the average citywide arrears is $663 and average monthly payment is $75, Brown said.

Under WRAP, the average Detroit customer can get $25 per month toward his or her total bill, reducing the monthly payment to $50.

If payments are made on time for six months, half of that customer’s arrears — up to $350 — will be forgiven. If he or she continue to meet the payment schedule over another six months, the remaining arrearages — up to $350 — are credited.

About 80 percent of the Detroit residents enrolled in WRAP also are eligible for up to $1,000 per household in plumbing fixes to address leaks and keep usage down.

Myriad customer issues

Cupp said Wayne Metro is currently following up with clients about missed payments. About 25 percent, made an initial payment minus the anticipated $25 credit. That monthly stipend, however, doesn’t kick in until customers make the first payment in full.

Others misunderstood program guidelines, forgot to pay, didn’t have enough money or no longer wanted to be in the plan, she said.

“As service providers, we understand the level of poverty and the level of challenges faced by people living in poverty,” Cupp said. “It’s very much a crisis lifestyle.”

About 800 applicants didn’t meet income requirements, already belonged to other plans or tried to sign up in a name different from what’s listed on the household water bill.

Sylvia Orduno, an organizer with the Michigan Welfare Rights Organization, contends the program will fail, like others have, because many just don’t have the means to pay.

“It’s not that people don’t understand the rules,” she said. “People can’t afford water bills with the incomes they have now.”

Meanwhile, DWSD in May resumed shutoffs for delinquent water accounts. Officials estimated about 20,000 residential customers had defaulted on payments and were eligible for cutoff.

Of those, 10,395 avoided shutoff by making payments or joining assistance programs. Overall, there have been 13,158 new payment plan arrangements for Detroit customers since May, said Linda Clark, a spokeswoman for DWSD.

Clark was unable to provide shutoff figures but said 99 percent of the accounts turned off were restored within eight hours.

DWSD has 175,000 residential account holders. About 155,000 are current on bills or in payment plans.

Councilwoman Raquel Castaneda-Lopez is among those advocating for an income-based water affordability plan.

She’s urged the water department to consider a moratorium on shutoffs for the city’s most vulnerable population.

Castaneda-Lopez added it’s “a little bit concerning” customers are already struggling with payments in the program.

“It’s great that we have a strong WRAP program, but if people can’t even pay, it speaks to the unaffordability of the rates,” she said. “What do we do to address that?”